What is the date of the Australian employment report and what impact could it have on the AUD/USD currency pair?
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Thursday’s rather busy economic docket kicks off with the release of the Australian monthly employment details, due at 01:30 GMT. The report published by the Australian Bureau of Statistics is anticipated to show that the number of employed people rose by 23K in August as compared to a loss of 14.6K in the previous month. The unemployment rate, meanwhile, is forecast to hold steady at 3.7% and the Participation Rate is also expected to remain unchanged at 66.8% in August.
According to Yohay Elam, Senior Analyst FXStreet: “Market consensus expects an increase in jobs for August but there is room for a downside surprise, which would mean a second consecutive month of declines. The accumulation of employment in recent months means there is room for a second consecutive drop, as seen in December 2022 and January 2023. Another reason to expect a weak report comes from China. Australia’s main trading partner is still struggling to create growth as its property sector suffers from an immense debt crisis. China consumes raw metals such as iron and copper from Australia, as well as other goods. Prospects for a weaker economy may have deterred employers from hiring.”
Ahead of the crucial labour market data, the AUD/USD pair touches a one-and-half-week high, around mid-0.6400s during the Asian session on Thursday. Given that the Reserve Bank of Australia (RBA) might have already ended its rate hiking cycle, any positive surprise might do little to impress bulls or provide a fresh impetus to spot prices. That said, a modest US Dollar (USD) downtick might continue to act as a tailwind for the major.
In contrast, even a slight disappointment would be enough to weigh heavily on the Australian Dollar (AUD) amid growing concerns about the worsening economic conditions in China and looming recession risks. This, in turn, suggests that the path of least resistance for the AUD/USD pair is to the downside. Hence, any subsequent move up might still be seen as a selling opportunity and runs the risk of fizzling out rather quickly.
• Australian Jobs Preview: Weakening global economy set to hit labor market, hurt Aussie
• AUD/USD holds ground near 0.6400 ahead of the Australian employment data
• AUD/USD Forecast: Steady above 0.6400 ahead of Australian jobs data
The Employment Change released by the Australian Bureau of Statistics is a measure of the change in the number of employed people in Australia. Generally speaking, a rise in this indicator has positive implications for consumer spending which stimulates economic growth. Therefore, a high reading is seen as positive (or bullish) for the AUD, while a low reading is seen as negative (or bearish).
The Unemployment Rate released by the Australian Bureau of Statistics is the number of unemployed workers divided by the total civilian labor force. If the rate hikes, indicates a lack of expansion within the Australian labor market. As a result, a rise leads to weaken the Australian economy. A decrease in the figure is seen as positive (or bullish) for the AUD, while an increase is seen as negative (or bearish).
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