Morning Brief – Aussie Under Pressure

The Australian dollar came under pressure during the Asian trading session after Employment in Australia unexpectedly declined by 4,30 to 13.88 million in April 2023, missing market forecasts of a 25,000 gain and after an upwardly revised 61,100 gain a month earlier.

The latest reading marked the first drop in employment following rises in the previous two months. Full-time employment fell by 27,100 to 9,726,500 while part-time employment grew by 22,800 to 41,556,900.

During a week of soft economic data from China and broader market pressure from the debt ceiling the AUDUSD and AUDJPY pairs tumbled on the jobs’ news.

Also, Australia’s seasonally adjusted unemployment rate unexpectedly came in at 3.7% in April 2023, compared with market estimates and March and February’s near 50-year low of 3.5%.

The latest figure also marked the highest jobless rate in three months, as the number of unemployed climbed by 18,400 to 528,000, with people seeking full-time jobs rising by 15,500 to 364.800 while those looking for part-time jobs fell by 3,500 to 163,900.

The participation rate edged down to 66.7% from 66.8%, matching market consensus. The underemployment rate inched down to 6.1% from 6.2%. Monthly hours in all jobs increased by 29 million or 2.6% to 1,974 million.

On a quarterly basis, the wage price index rose by 0.8% for the second consecutive quarter in Q1, below the consensus of a 0.9% rise.

The data today in addition to the subdued wages data published yesterday, along with other indications showing some steam coming out from the Australian economy should give the Reserve Bank of Australia reason enough to pause at its upcoming June 6 meeting.