Australian dollar resilient ahead of today's jobs report. What's driving it
Pandemic will continue to impact the employment market
News has improved on the Australian pandemic situation as the vaccination rate ramps up. Beyond that, rising commodity prices are a major tailwind for the Australian dollar once we settle into the post pandemic period.
That's being reflected today in what's been a choppy day of trading. AUD/USD is up 30 pips to 0.7377 and pressing against yesterday's high, which was the best level in a month.
Last month's jobs report showed a 146K decline including 68K full time job lesses. It was the worst since early in the global pandemic.
There's no reason to expect a quick improvement with heavy lockdowns continuing through September. The consensus is for another 137.5K jobs lost and unemployment ticking up to 4.8% from 4.5%.
The good news in Australia and globally is that the pandemic is not worsening. This chart shows changes and improvements in the seven-day average compared to the prior week.
Overall, I think that's an underreported story. There was a built in fifth wave globally but it's looking like (crosses fingers) we could be putting this nightmare behind us.