The Australian dollar popped higher on Thursday after jobs data proved far stronger than expected, pushing up bond yields and perhaps bringing closer the day when official interest rates might rise.
The Aussie dollar AUD=D3 added 0.5 percent to $0.7274 and put some more distance between the week's lows at $0.7164. The next major barrier is the November top at $0.7303 and then a September peak at $0.7315.
The kiwi dollar NZD=D3 followed to reach $0.6797, but faces stiff resistance at the November high of $0.6820.
The gains came after data showed Australian employers created a net 32,800 new jobs in October, handily beating market forecasts of 20,000.
Full-time positions climbed a strong 42,300 and the unemployment stayed at 5.0 percent, the lowest since 2012.
The main soft spot was the share of underemployed, those who would like to work more hours, which remained high at 8.3 percent and implied there was still plenty of spare capacity in the labour market.
Investors reacted by only slightly narrowing the probability of a rate hike next year, though a move is still not fully priced in until April 2020.
"Continued solid growth in jobs and total hours worked will benefit consumers through higher household income, as well as boosting consumer sentiment," said Shane Oliver, head of investment strategy and chief economist at AMP Capital.
"However, the still large amount of labour market slack means wage inflation pressures will remain weak," he said. "As result we remain of the view that the RBA won't start raising interest rates until 2020 at the earliest."
Australian government bond futures dipped in the wake of the data, with the three-year bond contract YTTc1 off 4 ticks at 97.810. The 10-year contract YTCc1 eased 2.5 ticks to 97.2650.
New Zealand government bonds
0#NZTSY= fared better, with yields down 2.5 basis points at the long end of the curve.
