- Figures for June revealed a robust increase of 32,600 in net employment in Australia.
- Australia’s jobless rate remained close to 50-year lows.
- The US dollar was relatively weak though it remained above its recent 15-month low.
Today’s AUD/USD forecast is bullish. On Thursday, the Australian dollar experienced a significant surge due to the country’s exceptional employment data.
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Figures for June revealed a robust increase of 32,600 in net employment from May, far exceeding the anticipated rise of 15,000.
Moreover, the jobless rate remained close to 50-year lows, demonstrating the labor market’s resilience. Consequently, this could lead to further rate hikes by the Reserve Bank of Australia (RBA).
Notably, the Aussie currency spiked nearly 1% to an intra-day high of $0.6840 during Asia trade. According to Matt Simpson from City Index, the Australian dollar soared across the board as rate-hike expectations increased. The impressive employment figures pressure the data-dependent RBA to consider raising rates in August.
After the release of the jobs data, market sentiment shifted. Subsequently, the probability of the Reserve Bank of Australia (RBA) resuming rate hikes in August increased from 35% to 42%. Moreover, the projected rate peak climbed from 4.35% to 4.42%.
Despite the RBA’s efforts to control inflation by raising interest rates by 400 basis points to an 11-year high of 4.1% in just 14 months, the labor market has consistently defied expectations of a slowdown. Therefore, further measures may be necessary to tackle inflation.
Meanwhile, the US dollar was relatively weak in the broader currency market, though it remained above its recent 15-month low.
AUD/USD key events today
The US will release several key economic reports later today. These include the initial jobless claims, the Philadelphia Fed manufacturing index, and the existing home sales reports.
AUD/USD technical forecast: Bulls take back control and target 0.6900.
On the charts, AUD/USD trades slightly above the 30-SMA after breaking above the 0.6800 resistance level. At the same time, the RSI has crossed above the 30-SMA, indicating stronger bullish momentum.
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Bears had attempted to reverse the market direction by pushing the price below the 0.6800 key level. However, bulls are still strong and have managed to take back control. If they can keep the price above the 30-SMA, it will likely climb to the 0.6900 resistance level.
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Source: https://www.forexcrunch.com/aud-usd-forecastsoars-on-unexpected-jobs-growth/
