The AUD v EUR exchange rate managed to get the rally it was pushing for in recent sessions as the market traded through the 1.9200 level and rallied 0.8% to trade above 1.9300.
Economic releases from the Eurozone mixed with a small tick higher in Australian unemployment was enough to see the euro currency continue its climb off of the recent lows near 1.6050.
Unemployment Numbers Not Ideal for the RBA
The Bank of Australia (RBA) has been vocal lately in stating that further economic stimulus would only be warranted if employment dips in the country. Today’s release of employment numbers from the Australian economy saw unemployment at 5.3%, a small tick higher from last month’s 5.2%. This is not an ideal situation for the RBA, however the economy did add 13.5k jobs, which was more than the 10k expected.
The additional jobs will balance the sentiment for now but traders will watch the coming months closely to see how the Australian economy performs.
Eurozone Economic Releases Show Promise
Alongside the release of the ECB’s latest policy meeting minutes, was consumer confidence figures for the Eurozone, which came in at -6.6%. Although in negative territory, the number was better than the -8.2% figure that was expected and investors will hope that confidence is increasing after the end of the Brexit stalemate.
The ECB published a modestly upbeat set of minutes from their latest policy meeting, which was conducted before the Coronavirus outbreak. Members of the ECB “broadly agreed” that the incoming economic data and indicators “pointed to some stabilisation in euro area growth dynamics”.
The upbeat tone will reassure traders that the worst is possibly over for the EU economies and this has helped fuel the Euro’s rally on the day. The next releases to drive the AUD v EUR exchange rate will be this evening’s Australian PMI figures, which have shown contraction in manufacturing and services over the last two months. Australia’s numbers will be followed by the same data out of the Eurozone, whilst the EU economy also publishes the key Consumer Price Index. Estimates are for the economy to match last month’s 1.4% and improvement on this number would add further fuel to the European currency outlook.
Markets in Asia are still showing optimism that the worst of the Coronavirus impact is over but this has failed to support the Australian dollar in a meaningful way.
If you’re considering buying or selling Australian dollars and would like to compare rates or know more about the factors that could impact your exchange rate, feel free to contact me directly, I look forward to hearing from you.