AUDUSD Bounces to 0.67 After Strong Australian Employment Data
AUDUSD has been falling for 3 weeks, losing 3 cents as the USD turns higher and risk sentiment turns negative for commodity dollars.
AUDUSD has been falling for 3 weeks, losing 3 cents as the USD turns higher and risk sentiment turns negative for commodity dollars. The geopolitical tensions have helped push this pair lower, helped by a less-dovish FED, while China is not convincing markets with its monetary and fiscal stimulus measures, hurting the AUD.
Since early October, AUD/USD has lost nearly 3 cents, and comments from RBA’s Hunter yesterday pushed the pair below the 0.67 mark. Over the weekend, China reported declines in both its Producer Price Index (PPI) and Consumer Price Index (CPI), raising concerns about weaker domestic demand for risk-sensitive assets like commodity-linked currencies, including the Australian dollar.
AUD/USD Chart Weekly – Approaching the 50 SMA
The lack of new stimulus measures from Chinese authorities further disappointed investors, amplifying the negative sentiment affecting both stock and commodity markets. On the weekly chart, AUD/USD is nearing support at key moving averages, which may make further selling challenging. The pair faced additional selling pressure as it retested the 0.6700 support level. During its September meeting, the Reserve Bank of Australia held the cash rate steady at 4.35%, but the meeting minutes released afterward indicated a more dovish tone. Additionally, Australia’s employment report came out last night—a key data point the RBA is closely watching.
Australian Employment Report for September
- Employment Change: +64.1K
- Expected: +25.0K
- Previous: +47.5K
- Unemployment Rate: 4.1%
- Expected: 4.2%
- Previous: 4.2%
- Participation Rate: 67.2%
- Expected: 67.1%
- Previous: 67.1%
- Full-Time Employment: +51.6K
- Previous: -3.1K
The Australian dollar experienced a strong rise after the release of robust employment data earlier today. Given that the economy remains relatively resilient and inflation remains steady, the narrative of an RBA rate cut seems less plausible. Now, market sentiment leans heavily towards the RBA maintaining the current cash rate in November, with odds at approximately 91%, challenging earlier expectations.
AUD/USD Live Chart
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