The Australian dollar sank today after the terrible employment report reignited speculations about possible interest rate cut by the Australian central bank.
Australian employment shrank by 22,600 (seasonally adjusted) in December from a month ago. It was nowhere near the expected increase of 10,300. The unemployment rate stayed at 5.8 percent.
Ahead of the report, there was a general consensus that the Reserve Bank of Australia will pause with interest rate cuts for a while. But now it looks like the RBA may consider loosening its monetary policy even more and this is not good for the Aussie.
AUD/USD tumbled from 0.8914 to 0.8805 as of 18:51 GMT today, reaching the low of 0.8775 intraday — the weakest rate since August 2010. EUR/AUD advanced from 1.5257 to 1.5442 and AUD/JPY was down from 93.20 to 91.93.
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