— Paul Dales, Capital Economics
The Australian economy created more than expected jobs last month, while the jobless rate fell unexpectedly. The Australian Bureau of Statistics reported on Thursday that the economy generated 42.0K jobs on a seasonally adjusted basis in May, following the preceding month's upwardly revised gain of 46.1K jobs, whereas analysts expected the economy to create just 9.7K new positions. That marked the eight-straight month of job gains, with 124K full-time positions created since September 2016. However, the participation rate rose just 0.1% to 64.9% during the reported period. Thursday's data also showed that the unemployment rate dropped to 5.5% last month, whereas economists expected the rate to remain unchanged at 5.7%. The strong employment data is expected to please the Reserve Bank of Australia and remove a possible rate hike from the table. Nevertheless, due to weak pay growth, the Bank is set to remain on hold until 2019. After the release, the Australian Dollar hit its multi-week highs against the Euro and the British Pound and hit 0.7636 against its US counterpart.
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