Australia Surprises Estimates, Unemployment Plummets, 27.3K New Jobs
To much shock, Australia added a net 27,300 jobs in April. As a result, the unemployment rate dropped to 5.4% from 5.7%. Economists had forecast the figure to actually rise, to 5.9%. Full-time positions grew by an astonishing 49,100 while part-time ones fell by -21,800.
This bodes well in the face of the last two Reserve Bank of Australia policy meetings. RBA policymakers cut the overnight rate at the Apr. 8 meeting by only 25 basis points while leaving it steady at the meeting that took place on Monday. Governor Glenn Stevens, in his accompanying statement, said that the combination of fiscal stimulus and monetary policy would probably be substantial enough to prop the ailing economy.
China may have been a large contribute to the renewed Australian economic strength. Trade data published yesterday revealed that exports to the Asian nation jumped 24% while that of the U.S. slumped 7.8%. China's ambition to continue growing at rates exceeding 5.0% have led it to invest in infrastructure projects that require large sums of commodities. Indeed, Australia saw an increase in aluminum and iron ore sales to foreign countries surge ahead by 24.0% and 7.8%, respectively.
AUDUSD spiked about 70 pips in the two minutes following the release of the news.
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