The Australian dollar jumped back into positive territory after data showed employment rose more than expected in April and the jobless rate fell to its equal-lowest level this year.
That is despite concerns in recent months about the health of the labour market, particularly stagnant wage growth.
The Australian economy added 37,400 jobs in April, down from a revised – but still strong – 60,000 (previously 60,900) the previous month, according to the Australian Bureau of Statistics. However, this was well above the addition of 5,000 jobs pencilled in by economists.
The unemployment rate fell to 5.7 per cent from 5.9 per cent in March, beating expectations it would remain flat. This brings it on par with January’s level, making it the equal-lowest this year.
Within the split of full- and part-time jobs, it was part-time roles that gained at the expense of full-time ones. However, the minutes from the central bank’s May policy meeting revealed it had conducted an in-depth discussion about changes in the composition of employment and took the view that “the distinction between full-time and part-time work had become less important in assessing labour market conditions.”
The Australian dollar climbed as much as 0.3 per cent to $0.7456 following the release of the stronger-than-expected data, a quick reversal from its low of as much as 0.3 per cent before the numbers came out.
Prior to the release of the data, David de Garis at National Australia Bank said:
ABS employment has been under-clubbing relative to such indicators for quite some months and a complete reversal of last month’s for once stronger than expected +61K rise would be a disappointment to the market. NAB’s “pick” is a gain of 10K in total employment, sufficient to push the unemployment rate back to 5.8%. We’ll be alert to any potential noticeable impact from Cyclone Debbie on Qld and (north coast) NSW.