-ANZ
The Australian Dollar together with its New Zealand visa vie were the most bullish currencies over the last five trading days, both adding more than 1%. Both currencies were pushed higher by domestic data and upbeat figures from China. Nevertheless, Aussie's rally can be running out of steam soon.
The AUD/USD currency pair fell more than 40 pips on Thursday, dragged lower by disappointing labour market data. The decline, however, was short-lived, and the pair moved back above 0.94-mark. The Australian Bureau of Statistics said the unemployment rate remained unchanged at 5.8% in May, while analysts' expected an increase to 5.9%. The main disappointment came from the number of created new positions, as according to the report, Oz economy lost 4,800 jobs over the observed period. Economists expected a rise of 10,000 and the decline comes following a 14,200 full-time employment opportunities a month earlier. Furthermore, the participation rate fell to 64.6% from 64.7% in the prior month. While the ANZ expects the impact of the budget will be minimal, the upcoming taxes and spending cuts can become a massive drag on the Australian companies, and according, to the latest, sentiment report, they are already concerned about future prospects. It seems that even an increase in the unemployment rate will not be a surprise for markets, as the RBA already claimed they expect the indicator to remain around 6%.
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