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THE TAKEAWAY: The Australian Dollar soared on news that the 71,500 jobs had been added in February and that the unemployment rate dropped from 5.5% to 5.4%.
Ahead of the release of the Australian employment data, analysts were expecting the economy to have added 10,000 jobs in February but were surprised when the figure released came in at 71,500 jobs. Both the full-time and the part-time employment changes were drastically larger than January signaling a better outlook for the Australian economy. Consequently, the expected unemployment rate of 5.5% was an overestimate as the data showed that unemployment dropped to 5.4% as of February. Positive news also came from figures showing that the participation rate, the proportion of both the employed and unemployed population actively looking for employment, had risen from 65% to 65.3%.
The Australian Dollar, which has trended lower over January and February due to rate cut expectations, added to gains experienced in the last few days and soared to 1.0377 against the U.S. Dollar on the news, which is the highest point since February 6th. The so called ‘Aussie’ rallied significantly against its other major counterparts as investors grew more confident of the state of the Australian economy.