Aussie Remains Weaker After Job Data as Moody's Warns on Budgetby
Australia’s dollar remained weaker after a report showed a bigger-than-expected increase in the number of people employed was mainly due to part-time jobs, increasing prospects of policy action from the central bank.
The Aussie briefly jumped after the statistics bureau said 26,100 jobs were added in March, compared with the median estimate for an increase of 17,000 positions in a Bloomberg survey. The currency reversed direction as the data showed full-time jobs decreased by 8,800, while part-time workers surged by 34,900. The unemployment rate fell to 5.7 percent, versus the 5.9 percent projection.
“Potentially it could be a full-time versus part-time story,”said Darryl Conroy, a Brisbane-based analyst at Suncorp Group Ltd. “The bulk of that growth is coming from the part-time workers, which you’d presume would have less disposable income to spend. So potentially that’s a reason why, as the markets digest some of the details, it explains why the Aussie dollar was a little bit soggy.”
The Australian currency fell 0.3 percent to 76.26 U.S. cents as of 11:51 a.m. in Sydney from 76.53 on Wednesday. It has climbed 4.7 percent so far this year.
Demand for the currency was already dented after Moody’s Investors Service said the Australian government’s focus on spending cuts would make balancing the budget difficult. In the absence of revenue-raising measures, limited expenditure cuts are unlikely to meaningfully advance the government’s aim of balancing the budget and debt will likely continue to climb, the ratings company said in an e-mailed report Thursday. That would be a credit negative for Australia, it said.