- AUD has picked up a strong bid on a surprise drop in the Aussie unemployment report.
- The economy added fewer jobs that expected in February. Further, the labor force participation ticked lower and the quality of jobs deteriorated. That could cap gains in the pair.
The Australian Bureau of Statistics reported a surprise drop in the jobless rate at 00:30 GMT, sending the Aussie dollar higher across the board.
The AUD/JPY pair jumped 44 pips to a session high of 79.35 and was last seen trading at 79.30.
The jobless rate, which was expected to remain unchanged at 5 percent, dropped to near eight-year low of 4.9 percent in February, signaling tightness in the labor market.
That, however, may not weaken the odds of a near-term easing by the Reserve Bank of Australia, as the jobs growth was hardly impressive. To start with, the economy added just 4.6k jobs in February compared to 39.1K additions in January and more importantly, full-time jobs dropped by 7.3K, having surged by 65.4k in January.
The AUD, therefore, may have a hard time extending or holding on to the gains seen at press time, unless the equities surge in response to the dovish Fed, strengthening the offered tone around the anti-risk JPY.