Australia’s labor market keeps on strengthening. February’s figures reported by Australia’s official statistical agency confirm that. At the same time, the latest RBA meeting minutes show that the labor market stats are going to play one of the key roles in the future decisions related to the central bank’s monetary policy this year.
When adjusted for seasonality, the unemployment rate dropped all the way down to 5,8% in February 2016 as opposed to January’s 6,0%. At the same time, experts had anticipated zero change and therefore their predictions eventually failed.
Apparently, lower unemployment is a good sign for any economy out there, especially today when the global economy is slowing down, and the same holds true China – the world’s second biggest economy and Australia’s major outlet (it is not a secret that the Australian economy is heavily dependent on its commodity export to China). To be more specific, higher unemployment reduces the chances of the RBA easing its monetary policy and increases the chances of a stronger national currency.
FOREX
In the meantime, Masterforex-V Academy reports the Australian Dollar keeps on rallying against the U.S. Dollar, which means that AUDUSD is going up. To be more specific, AUDUSD is going on with another upward momentum – wave 3/С of level Daily3. By now, there price is building wave 5 or the “Hound of he Baskervilles” pattern by Elder/MF inside the mentioned rally.
A further hike above the local high of 0.7649 will give way to other highs, thereby making the Aussie even stronger against its American counterpart. If that’s the case, the closest targets are 0.7656, 0.7818/49. Alternatively, a break below the bottom of the ascending MF sloping channel and MF pivot 0.7413 will put an end to the rally and indicate the recovery of the U.S. Dollar against the Aussie.
