The Australian dollar came off a six-week high on Thursday after a surprisingly weak employment report showed a big slide in full-time jobs and added to the risk of a further cut in interest rates. The Australian dollar snapped a six-day winning streak to trade at $0.7689. It slipped 0.4 percent after earlier rising to $0.7735, its highest level since September 8.
Firms shed a huge 53,000 full-time jobs in September even though the unemployment rate stayed at a three-year trough of 5.6 percent. Just this week Reserve Bank of Australia (RBA) Governor Philip Lowe emphasised that rising underemployment and weak hours worked meant there was a lot more slack in the labour market than the unemployment rate on its own might suggest.
"Recently there have been more signs of a softening (in the labour market) than a strengthening," Paul Dales, chief economist at Capital Economics said. The Aussie weakened on other crosses as well, falling nearly 0.4 percent each against the euro and the pound. It was off 0.3 percent on the yen. Against its New Zealand counterpart, it slipped 0.5 percent after rising on Wednesday.
The New Zealand dollar climbed to a more than 2-week high of $0.7265 after pushing higher overnight when the greenback gave up some ground. New Zealand government bonds were a shade firmer, with yields down 1 basis points at most. Australian government bond futures recouped early losses on the jobs report, leaving the three-year bond contract steady at 98.30. The 10-year contract was off 1 tick at 97.715.