Strong employment figures are supporting the aussie

The pound slid 0.7% against the Australian dollar yesterday after the UK's pre-Budget Report failed to abate fears over the UK's deteriorating fiscal stability.

• Sterling lost ground after investors questioned the feasibility of the government's forecasts for borrowing and spending in the report.
  
• Some investors were skeptical of Darling's 1.5% growth projection for the UK economy in 2010, which in turn undermined his outlook for bringing down the country's deficit and debt.
  
• The aussie is continuing to trade strongly this morning in the wake of positive employment data from Australia.
  
• The data revealed the economy added 31,200 jobs last month, beating forecasts of a modest rise of 5,000. The result brought the overall unemployment rate down to 5.7% from 5.9% support strong aussie demand.
  
• Analysts noted that with unemployment now potentially on the decline, the RBA will be more confident in returning their base rate to pre-recession levels.