The Aussie dollar grew for a fourth straight day to a monthly high against the U.S. dollar, rallying from half a year’s low. It climbed roughly 0.37 percent and closed at US$0.76646 on Thursday after the release of low unemployment rate in Australia.
Figures released yesterday by the Australian Bureau of Statistics showed the jobless rate was just 5.4 per cent nationally — its lowest level since February 2013. Meanwhile, the 61,600 new jobs marked the biggest increase for any month in more than two years and was far higher than the 19,000 improvement the market had expected.
The spike means the national workforce has now increased by 383,000 in the past year, which Prime Minister Malcolm Turnbull said yesterday equates to more than 1000 jobs per day or “… 1000 new opportunities for Australians seeking to get ahead to advance their dreams for themselves and their families”.
“The record job numbers today show more Australians have got a job, more have the confidence to be out looking for a job and more employers are investing and creating more jobs and hiring more workers,” Mr Turnbull said.
The rise in employment hiring is partly attributed to increasing demand for workforce during the holiday period of Christmas. Companies are seeking for good financial statements, by methods of clearing inventories at discount. In this case, more jobs are created to meet the corporate’s actions.
Australia has become the most China-reliant economy in the developed world, with around a third of its exports going there. The composition of those sales is changing: 8 percent of China’s imports from Australia were consumer goods last year, compared with just 2 percent in 2013, while the share of minerals has fallen to 56 percent from 62 percent over the period.
The ties have made the Australian dollar a proxy for Chinese growth, especially as it’s easier to trade the more-liquid currency than the yuan.
However, UBS has cut its forecasts for domestic consumption, outlining three key threats which will continue to weigh on household spending in the new year, which ae weak wages, flat house price growth and a low household savings rate.
Technically if we analyse with ‘Ichimoku’, the price is approaching the ‘cloud’ which is seen as a ‘filter’. In the event that it crosses over the filter completely, the pair AUD/USD is expected to rise further; otherwise, it likely continues to waver at the current level.
Chart 1: AUDUSD Daily
The shorter outlook for the pair, if we look at the M30-chart, is facing a resistance above at Dec 14’s high of 0.76791. If it succeeds to break higher in the next few days, further rise can be seen by investors.
Chart 2: AUDUSD 30-Minute