- AUD/USD drops to lowest since May 31 on Australian jobs data.
- Australia’s jobless rate remained steady at 5.2% in May.
- Aussie jobs growth bettered estimates, but the surge was largely fueled by part-time jobs.
- Markets may pull forward expectations of an RBA rate cut to July.
AUD/USD slipped to 0.6914, the lowest level since May 31, after the official data released at 01:30 showed Australia’s jobless rate remained steady at 5.2% in May.
The markets were expecting the unemployment rate to drop to 5.1%. Further, the data showed the economy added 42.3K jobs in May, beating both the forecasted job growth of 17.5K and April’s print of 28.4K by a big margin.
The big beat on the employment change, however, failed to put a bid under the AUD, possibly because the full-time jobs increased by a meager 2.4K, meaning the massive job addition in May was largely fueled by part-time jobs.
Overall, the jobs report is pointing to labor market weakness. As a result, the markets may pull forward expectations of an RBA rate cut to July. Therefore, the AUD could remain under pressure during the day ahead.
As of writing, the AUD/USD pair is trading at 0.6917, representing a 0.17% drop on the day. The currency pair closed at 0.6928 on Wednesday, violating the ascending trendline connecting May 23 and May 31 lows. So, the path of least resistance is to the downside.