The British pound is higher against the Australian dollar on Thursday.
- Australian unemployment reaches highest in 22 years.
- China returned to growth in the second quarter according to official statistics
- UK jobless rate surprisingly dips in June
- Japan reports a record 502 new coronavirus cases today
GBP/AUD was up by 62 pips (+0.36%) to 1.8011 as of 4pm GMT. This week the pound-Aussie dollar exchange rate is -0.84%
The currency pair dipped beneath 1.795 before returning back above the 1.80 round number, snapping a 3-day losing streak. Yesterday it fell -0.23%.
GBP: Jobless claims surprisingly drop in June
The pound was supported by a surprise reduction in the UK jobless rate in June, helped by the gradual reopening of the economy from lockdown. Jobless claims fell -21,800 after soaring by +528,900 in May.
On the face of it the data is very much welcome news for the UK economy. More jobs and less people claiming benefits is good, however the government furlough scheme blurs the picture. Since the furloughs are expected to run until October, it may not be until the fourth quarter that the data starts to reflect reality again.
AUD: Australian unemployment reaches 22-year high
It was a good start for the Aussie dollar after its biggest foreign customer; China saw its economy return to growth in the second quarter having declined sharply in Q1 – avoiding a technical recession. The Chinese economy grew 3.2% versus the same quarter last year. However Chinese stocks fell by 5% as local investors lost their nerve when the recent rally fizzled out.
However, domestic data from Australia was less favourable. The unemployment rose to 7.4% in June from 7.1% prior to reach its highest since 1998 according to the Australia Bureau of Statistics. That was because although more jobs were added in June, more people re-entered the workforce looking for jobs after lockdown measures were eased.
A broader risk for the Asia region came from shock news that Japan saw its highest coronavirus count to date of 502 new cases in 24 hours. Although the number is small compared to other developed nations, it is a sharp increase over prior readings.
