July 14, 2022 - 12:03 PM 282 views
The unemployment rate in Australia fell to its lowest level in nearly 50 years in June, according to figures issued on Thursday by Australia. This strengthened the case for a significant increase in interest rates, according to Bloomberg.
The outcome prompted traders to begin pricing in a 75 basis point rate increase for August by the Reserve Bank of Australia, with bets climbing to 47% from 0% before the data. Local bonds were sold off, which increased the three-year yield to 3.06 percent by as much as 19 basis points.
The information strengthens the argument for a large increase from the Reserve Bank of Australia at its meeting in August. We anticipate the RBA to keep accelerating its tightening given the continued high level of price pressure.
The Market Reaction
The AUD/USD steadily climbs above 0.6775, up 0.21 percent intraday as of press time, as a result of the stronger Australian jobs report and growing hawkish wagers on the Reserve Bank of Australia's (RBA) next move.
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