Although the Australian Dollar plummeted against its peers following the release of worse-than-anticipated employment figures, the currency wasn’t kept down for long.
The Australian Dollar exchange rate was trading in the region of 1.0544 against the US Dollar as of 10:20 am GMT
As disappointing as the employment figures were, it seems investors are looking at the bigger picture. When viewed in conjunction with other recent Australian data releases (such as last week’s better-than-forecast trade balance figures and retail sales surge) the employment data isn’t as concerning as it first appears.
During local trade the ‘Aussie’ recouped the losses sustained in the immediate aftermath of the publication of the employment data, and after Treasurer Wayne Swan commented positively on the outlook of one of Australia’s main trading partners the South Pacific currency advanced to $1.0550, putting it in line to record a five-day gain of 1.6 per cent.
Yesterday Swan announced that Chinese and Australian academics are to begin working on a research project concerning the Chinese Yuan’s internationalization.
China, which has strong trade links with both Australia and New Zealand, is expected to post its most rapid quarterly growth gain for a year when GDP figures are published next week. Economists have estimated that China’s economy grew by 8 per cent in the first quarter of 2013.
Although the ‘Aussie’ has since dipped from the highs recorded yesterday, industry expert Kengo Suzuki has asserted: ‘The Australian and New Zealand Dollar’s are likely to remain resilient. The rising optimism toward China’s economy is underpinning both currencies.’
A currency strategist with OzForex also noted: ‘There has been a bit of positive sentiment from equity markets and it looks like that is helping to keep the Aussie Dollar buoyed.’
Next week key Australian data to watch out for includes Monday’s home loans figures and the release of RBA policy meeting minutes on Wednesday. A stream of Chinese data is also likely to inspire volatility.
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