FXStreet (Delhi) – Lee Hardman, Currency Analyst at MUFG, notes that the main economic data release in the Asian trading session was the latest employment report from Australia and the report surprised again to the upside but more modestly than in previous months. Key Quotes “The report revealed that the Australian economy shed only 1k jobs in December following an upwardly revised gain of 74.9k in November. Employment growth averaged a robust 43k/month in Q4. The unemployment rate also held at 5.8% in December having declined by 0.5 percentage point since July of last year. Employment growth has been exaggerated by sample rotation in the survey affecting recent months, which is expected to be evident as well in next month’s report. Still it does appear as well that the underlying trend remains one of improvement in the Australian labour market. It remains an encouraging development for the RBA which is dampening the need for further monetary easing and providing support for the Australian dollar. However, the positive domestic developments are being offset by building downside risks from negative external developments. The negative hit to Australia’s economy from the deterioration in their terms of trade is continuing as the price of iron ore has lost another third of its value since early in September. Overall we maintain a bearish outlook for the Australian dollar expecting further weakness although more modest than in recent years. A sharper economic slowdown in China could challenge our view for more modest weakness in the year ahead.” For more information, read our latest forex news.