Australian Dollar Falls As Employment Slumps To Historic Low On Shutdown

By | May 14, 2020
Australian Dollar Falls As Employment Slumps To Historic Low On Shutdown

The Australian dollar declined against its major rivals in the Asian session on Thursday, as the nation’s employment plunged to a record low in April due to the impact of broad-based lockdowns following the COVID-19 pandemic.

Data from the Australian Bureau of Statistics showed that the Australian economy lost 594,300 jobs last month to 12,418,700 – missing forecasts for a decline of 575,000 following the increase of 5,900 jobs in the previous month.

The jobless rate in Australia came in at a seasonally adjusted 6.2 percent in April, the highest since September 2015.

That was up from 5.2 percent in March but was well beneath expectations for 8.3 percent.

Risk sentiment deteriorated amid rising concerns about the economic impact of the coronavirus pandemic after the U.S. Federal Reserve Chairman Jerome Powell warned of a prolonged recession.

Powell said that the coronavirus crisis raises longer-term concerns that could result in an extended period of low productivity growth and stagnant incomes. He added the Federal Reserve is not considering adopting negative interest rates.

The aussie dropped to 1-week lows of 0.6420 versus the greenback and 1.6835 versus the euro, after rising to 0.6469 and 1.6728, respectively in early deals. The aussie is likely to find support around 0.60 versus the greenback and 1.77 versus the euro.

Reversing from a high of 69.16 hit at 9:30 pm ET, the aussie declined to a 1-week low of 68.61 versus the yen. The aussie is seen finding support around the 65.00 area.

The aussie slipped to a 2-day low of 0.9057 versus the loonie, down from a high of 0.9115 seen at 9:30 pm ET. On the downside, 0.88 is possibly seen as the next support level for the aussie.

The aussie eased from an early high of 1.0773 against the kiwi, falling to 1.0742. The aussie is poised to find support around the 1.04 level.

Looking ahead, U.S. export and import prices for April and weekly jobless claims for the week ended May 9 are scheduled for release in the New York session.