- The AUD is on the rise courtesy of a sharp drop in the Aussie jobless rate to the lowest level since 2012.
- The US-AU yield spread hasn’t narrowed in response to an upbeat unemployment rate. Hence, a break above key resistance of 0.7160 may remain elusive.
The bid tone around the AUD strengthened, pushing the AUD/USD to a session high of 0.7130 after the Australian Bureau of Statistics (ABS) reported a big drop in the jobless rate in September.
The data also showed that employment in seasonally adjusted terms increased 5,600 to 12,636,300, missing the estimated rise of 15,000 and previous month’s print of 44,000. Further, full-time employment increased 20,300 in September vs 33,700 additions seen in September, meanwhile part-time employment decreased 14,700.
However, despite the big drop in the jobless rate, the spread between the 10-year US government bond yield and its Aussie counterpart has remained largely unchanged at 47 basis points.
As a result, the pair is having a tough time extending gains to the previous day’s high of 0.7160.
AUD/USD Technical Levels
Resistance: 0.7160 (previous day’s high), 0.7220 (trendline from January highs), 0.7309 (100-day EMA)
Support: 0.7042 (Oct. 5 low), 0.70 (psychological level), 0.6893 (September 2015 low)
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