AUD/USD rallies further to near 0.6800 on strong Aussie employment data

Australian Dollar Price Today

The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the Japanese Yen.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.02%	0.06%	0.27%	-0.05%	-0.59%	-0.30%	-0.23%
EUR	0.02%		0.08%	0.28%	-0.04%	-0.58%	-0.29%	-0.22%
GBP	-0.06%	-0.08%		0.21%	-0.12%	-0.67%	-0.37%	-0.30%
JPY	-0.27%	-0.28%	-0.21%		-0.31%	-0.83%	-0.58%	-0.49%
CAD	0.05%	0.04%	0.12%	0.31%		-0.53%	-0.25%	-0.18%
AUD	0.59%	0.58%	0.67%	0.83%	0.53%		0.30%	0.35%
NZD	0.30%	0.29%	0.37%	0.58%	0.25%	-0.30%		0.07%
CHF	0.23%	0.22%	0.30%	0.49%	0.18%	-0.35%	-0.07%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).

Australian Bureau of Statistics reported that the economy created 65.2K jobs, significantly higher than 30K estimates. In November, employers fired 28.7K workers, revised higher from 21.3K. The Unemployment Rate surprisingly dropped to 4.1% from the prior reading of 4.4%. Economists expected the jobless rate to increase to 4.4%.

Strong job numbers are expected to boost market expectations, supporting interest rate hikes by the Reserve Bank of Australia (RBA) this year.

The Aussie pair was already performing strongly in the past few trading days as the US Dollar (USD) underperformed due to disputes between the United States (US) and the European Union (EU) over Greenland crisis.

However, the US Dollar rebounded on Wednesday after President Donald Trump took back his decision of imposing 10% tariffs on imports from several EU nations announced last weekend. Trump also stated that Washington will not deploy military action over Greenland.

Going forward, investors will focus on the preliminary Australia-US S&P Global Purchasing Managers’ index (PMI) data for January, which will be released on Friday.

Employment FAQs

How do employment levels affect currencies?

Labor market conditions are a key element to assess the health of an economy and thus a key driver for currency valuation. High employment, or low unemployment, has positive implications for consumer spending and thus economic growth, boosting the value of the local currency. Moreover, a very tight labor market – a situation in which there is a shortage of workers to fill open positions – can also have implications on inflation levels and thus monetary policy as low labor supply and high demand leads to higher wages.

Why is wage growth important?

The pace at which salaries are growing in an economy is key for policymakers. High wage growth means that households have more money to spend, usually leading to price increases in consumer goods. In contrast to more volatile sources of inflation such as energy prices, wage growth is seen as a key component of underlying and persisting inflation as salary increases are unlikely to be undone. Central banks around the world pay close attention to wage growth data when deciding on monetary policy.

How much do central banks care about employment?

The weight that each central bank assigns to labor market conditions depends on its objectives. Some central banks explicitly have mandates related to the labor market beyond controlling inflation levels. The US Federal Reserve (Fed), for example, has the dual mandate of promoting maximum employment and stable prices. Meanwhile, the European Central Bank’s (ECB) sole mandate is to keep inflation under control. Still, and despite whatever mandates they have, labor market conditions are an important factor for policymakers given its significance as a gauge of the health of the economy and their direct relationship to inflation.