Australian dollar recovers as unemployment figures went down
The Australian dollar has slightly recovered after Australian employers created more jobs than what economists forecasted last month, pulling down the unemployment rate.
According to Bloomberg, the Australian dollar was at 69.70 U.S. cents as of 11:38 am in Sydney on Thursday, down by 0.7% from the previous day. It had been at 69.53 cents just before the statistics bureau announced the number of employed in Australia climbed to 17,400 in August. An increase of 5,000 jobs is expected by analysts, according to the median estimate in a Bloomberg survey. The rate for the jobless went down from 6.3% to 6.2 % in July.
Full-time jobs climb to 11,500 while part-time jobs boost by 5,900. The participation rate measuring the labor force in proportion to the population slide down to 65% from 65.1%, matching the predictions.
"The unemployment rate does seem stable in a 6 per cent-to-6.25 percent range," Su-Lin Ong, head of Australian economic and fixed-income strategy at Royal Bank of Canada in Sydney, said after the release.
"For a Reserve Bank that's clearly reluctant to cut further, you'd have to get a weakening of the labor market" as one of the conditions before the central bank could consider easing policy again.
Adding to the report, the increasing momentum in the housing construction and tourism industries soaks up workers surplus to requirements at mine sites where an investment growth is winding down. Still, a foretell decline in business spending and falling commodity prices are damping the economic outlook and the prompted the central bank to cut rates twice this year to a record low 2% according to The Straits Times.
Australia's currency "has now adjusted considerably and this adjustment has continued over recent weeks," central bank Deputy Governor Philip Lowe said in a speech on Wednesday. "Just as the appreciation helped stabilize the economy in the upswing of the boom in commodity prices and mining investment, the depreciation is helping in the downswing."
Last month, the National Australia Bank Ltd. plans to expand market share and employs 200 new bankers to support growth. It is the country's biggest lender to business.