The Australian dollar bounced from near five-month lows on Thursday as a mostly upbeat employment report triggered a round of short-covering, while its New Zealand counterpart extended its recent decline. The Australian dollar was holding on at $0.7596, after delving as deep as $0.7567 overnight amid a general mood of risk aversion globally. Dealers reported support around $0.7570 but felt it needed to get back above $0.7640 to avoid a further correction to at least $0.7535.
It won a reprieve from selling pressure when data showed Australia's jobless rate dipped to 5.4 percent in October, its lowest since early 2013. Employment missed estimates with a rise of just 3,700, but that was offset by a 24,300 gain in full-time work. Yet with plenty of slack left in the labour market and wage growth near all-time lows, investors still saw no chance of a rate hike for months to come.
The New Zealand dollar was trading down 0.3 percent at $0.6854 and threatening chart support at $0.6844. New Zealand government bonds rallied, pushing yields down as much as 5 basis points at the long-end of the curve.
Australian government bond futures paused after notching solid gains on Wednesday. The three-year bond contract eased 2 ticks to 98.030, while the 10-year contract was flat at 97.3950. In contrast, the Federal Reserve seems determined to raise US rates in December and up to three more times next year, which would take the US cash rate above Australia's for the first time since 2000.
Comments
Comments are closed for this article.