The Australian Bureau of Statistics’ December employment report, released at 00:30 GMT on Thursday, will be a direct catalyst for traders in the AUD/USD pair.
Market consensus suggests that the unemployment rate may remain unchanged at 3.4% on a seasonally adjusted basis. Furthermore, the participation rate is expected to remain unchanged at the previous level of 66.8%.
Today’s Australian employment data has become important for traders in the AUD/USD pair given that Reserve Bank of Australia (RBA) policymakers have recently stepped back from their hawkish bias.
Ahead of the event, a Westpac analyst said:
Leading indicators suggest employment growth will remain strong again in December (Westpac forecast: 30k). The unemployment rate should stabilize for the foreseeable future (Westpac forecast: 3.4%).
Similarly, an ANZ analyst said:
Given the tight labor market, strong job growth continued in December, adding 35,000 jobs, attendance remained at a record November high, and the unemployment rate stabilized at 3.4%. expected. Job openings fell 5% quarter-on-quarter in November, but are still very high by historical standards, and the NAB employment index is also well above average.
How will the data affect AUD/USD?
AUD/USD picked up bids to consolidate its biggest daily loss in two weeks while holding its highest level since mid-August 2022, bidding calmly near 0.6945 by press time. As a result, the Australian currency pair welcomed a broader US dollar weakness and hopes to see some positive data as a reminder of the cautious optimism in the market.
However, recent Fed talks have signaled a hawkish move, in contrast to other central banks looking to announce less aggressive monetary policy going forward.As a result, market sentiment has been mixed. and could weigh on the AUD/USD price if the upcoming Australian numbers fail to impress buyers of the pair.
Technically, Wednesday’s U-turn from the highest level since mid-August 2022, currently between 0.7020 and 0.6810, shows a bearish chart pattern of an ascending wedge in daily formation.
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About personnel changes
Employment change, published by the Australian Bureau of Statistics, measures changes in the number of people employed in Australia. Generally speaking, a rise in this indicator will have a positive impact on consumer spending, which will stimulate economic growth. Therefore, high numbers are considered positive (or bullish) for the AUD, and low numbers are negative (or bearish).
About the unemployment rate
The unemployment rate published by the Australian Bureau of Statistics is the number of unemployed people divided by the total private labor force. An increase in the rate would indicate a lack of expansion within the Australian labor market. As a result, the rise will lead to a weakening of the Australian economy. A decrease in the number is considered positive (or bullish) for the AUD and an increase is considered negative (or bearish).