The Australian dollar struck a one-week high around 77.75 US cents after a much stronger-than-forecast labour force report fuelled talk of an interest rate hike as early as next month. A softer US dollar ahead of Tuesday's December US trade data had supported the Aussie to 77.25 cents before the data, extending a recovery from a three-week low of 76.12 cents earlier in the week.
"Although the AUD is overbought, renewed rate support should allow this to persist for a little longer. Short-term we see a potential break above 80 cents," said ABN Amro strategist David Mozina.
The AUD was $0.7765/67 after a high of $0.7778, compared with $0.7650/52 late here on Wednesday, according to Reuters data.
January employment jumped 44,500 when forecasts had centred on a more modest 5,000 increase after four months of above average growth. A rise in the participation rate, which measures the number of people in work or looking for work, meant the unemployment rate held at a 28-year low of 5.1 percent.
The data followed Monday's hawkish monetary policy statement, which said the likelihood of a tightening had increased.
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