AUD has been one of the best performing major currencies so far in February. Better than expected Chinese trade data released yesterday was a boon for the AUD given Australia’s strong trade links with China. Moreover, as markets have backed away from RBA policy easing expectations AUD has gained a sound footing.
Positive sentiment for the AUD was dashed today however, following the release of January jobs data which came in worse than expected at -3.7k versus +15k consensus. The details were weak too, with the unemployment rate rising to a 10 year high of 6% and participation rate dropping to 64.5%.
The data will clearly restrain AUD in the short term, but is unlikely to spark renewed risks of further policy easing given a rise in inflation pressures. In this respect, AUD is set to continue to show some resilience over coming weeks. Near term AUD/USD support is seen around 0.8915.