Yesterday the Department of Labor in the US reported another 5.245 million jobless claims that have been filed for the fourth consecutive week since the coronavirus fallout started to impede the US labour market. With that, the number of people in America who have lost their jobs due to the epidemic since Mid-March has topped 22 million.
Yet, the epidemic-related surge in jobless claims has depreciated by more than a million over the last week, compared with the 6.615 million people who claimed benefits the week ending the 4th of April.
The final number also fell short of the consensus forecasts, which were projecting a weekly jump of 5.350 million claims. The crushing weekly numbers continue to represent a major impediment for the labour market, and the better-than-expected data - over 100k fewer job losses - provides little solace.
US Jobless Claims. Image source: TradingEconomics.com
The US dollar has so far been slow to respond to the bleak employment data that keeps pouring in due to the tremendously volatile markets and the continually changing environment.
If the 22 million jobless claims that have been accumulated over the last four weeks contribute to a surge in US structural unemployment, which by definition entails more lasting consequences for the economy, then this would undoubtedly pressure the greenback in the longer run.
For the time being, however, the global demand for the currency bolsters its strength as more and more investors flee to known safe-havens to hedge the risks they face from the mounting uncertainty.
The AUDUSD chart below illustrates this trend, as the recent bullish correction on the Aussie appears all but exhausted because the high demand for the greenback keeps the forex market quite volatile.
AUDUSD 4H Price Chart. Image source: Trendsharks ©, created with TradingView.com
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