AUD/NZD gyrates in a 1.1054-1.1064 range despite weaker Australian Employment data
- AUD/NZD has turned volatile as Australian payroll data has trimmed to 0.9k.
- Australian jobless rate has remained in line with the estimates and the prior release of 3.5%.
- Consideration of a slowdown in the current pace of rate hike for the RBNZ is out of the picture.
The AUD/NZD pair is gyrating in a 1.1054-1.1064 range as the Australian Bureau of Statistics has reported weak labor market data. The Employment Change has dropped sharply to 0.9% than the projections of 25k and the prior release of 33.5k. While the Unemployment Rate has been released in line with the estimates and the former figure of 3.5%.
Soft labor market data is not going to delight the Reserve Bank of Australia (RBA). The central bank won’t be able to hike the Official Cash Rate (OCR) unhesitatingly.
This week, the release of the RBA’s minutes hogged the limelight. The minutes dictated that RBA Governor Philip Lowe went for a slowdown in the pace of rate hike to safeguard the economy from domestic and global demand shocks. Also, the central bank pushed OCR to 2.6% in a short period of time, therefore, it has some liberty to prioritize the economic prospects too.
On the NZ front, kiwi bulls remained underpinned after the release of higher-than-projected inflation data. The annual Consumer Price Index (CPI) landed extremely higher at 7.2% vs. the expectations of 6.6% but marginally lower than the prior release of 7.3%. While the quarterly inflation figure surpassed the projections of 1.6% and the former print of 1.7% to 2.2%.
Higher-than-anticipated kiwi inflation signaled that discussion over slowing the pace of rate hike for the Reserve Bank of New Zealand (RBNZ) is far from consideration.