The Aussie rallied against the greenback yesterday following the release of overwhelmingly positive employment change data for October. The US dollar selloff was also fueled by higher-than-anticipated unemployment claims. Overall, the AUD/USD pair surged from a low of 0.6355 to a high of 0.6541 in the past 24 hours.
According to the data published by the Australian Bureau of Statistics, the country’s economy added 55,000 jobs in October, following an addition of 7,800 jobs in the previous month and more than double the 22,800 job additions forecast by economists.
The number of employed people grew to 14,173,500 in October from 14,118,500 in September. However, the underemployment rate stood unchanged at 6.30% in October. Also, the participation rate rose to 67% in October from 66.80% in September. The employment-to-population ratio rose to 64.50%, while monthly hours worked increased to 1,939 million. Full-time employment rose by 17,000 to 9,828,000 people. Likewise, part-time employment increased by 37,900 to 4,345,500 people.
The unemployment rate inched up to 3.70% in October from 3.60% in September. The reported figure was in line with the market’s expectations.
According to the US Department of Labor, the country’s first-time unemployment claims rose to 231,000 in the week ended November 11 from 218,000 (upwardly revised from 217,000) in the previous week, higher than forecasts of 221,000.
The four-week moving average was 220,250, up from 212,500 (upwardly revised from 212,250) in the previous week.
The Philly Fed manufacturing index, reflecting general economic activity, improved to -5.90 in November from -9 in October and pleased the market, which was expecting a further deterioration to -10.40.
The new orders index fell by 3 points to 1.30. Similarly, the employment index inched lower by 3 points to 0.80. Additionally, the current shipments index plunged to -17.90 from 10.80. The future new orders index fell by 8 points to 11.30. However, the future shipments index rose by 11 points to 16.30.
According to the US Federal Reserve, the country’s industrial production fell by 0.70% m-o-m in October, following a 0.10% rise in the previous month and worse than forecasts of a 0.40% decline.
Manufacturing output inched down by 0.70% m-o-m in October. The decline was led by a 10% decrease in the output of motor vehicles and parts. The index for manufacturing, excluding motor vehicles and parts, inched up 0.10%. The index for utilities fell by 1.60%, and the output of mines rose by 0.40%.
Notably, the total industrial production in October stood 0.70% below its prior-year level.
The Federal Reserve also stated that the US capacity utilization rate inched lower to 78.90% in October from 79.50% in September and missed forecasts of 79.40%.
The robust Australian employment change data and the rise in US employment claims are expected to keep the AUD/USD pair slightly bullish in the short term.
The historical price chart indicates that the AUD/USD pair is rising after consolidating at 0.6360. The next resistance is anticipated to be only near 0.6620. Additionally, the currency pair is trading above its 50-day moving average, while the MACD indicator is showing a positive reading. Therefore, we anticipate the AUD/USD pair to remain in an uptrend for the next few trading sessions.
Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.
