AUD/USD slips after weak jobs data – BBH

FXStreet Insights Team FXStreet

AUD/USD is down near the lower-end of this month’s 0.6440-0.6550 range. Australia’s May labor force report was soft, BBH FX analysts report.

RBA has room to deliver more rate cuts

"The economy unexpectedly lost -2.5k jobs (consensus: +21.2) after adding 87.6k in April. The details were not that bad. Full-time jobs increased 38.7k vs. 58.6k in April while part-time jobs fell -41.1k vs. 29k in April. The unemployment rate was unchanged at 4.1% for a fifth consecutive month and is tracking below the RBA’s June 4.2% projection."

"Leading indicators point to a weaker labor market. The NAB Employment subindex plunged to 0.4 (the lowest since January 2022) vs. 3.6 in April. Moreover, the Westpac-Melbourne Institute Unemployment Expectations subindex rose 5% to 127.4 in June, implying consumers expect unemployment to rise over the year ahead."

"The RBA has room to deliver more rate cuts. RBA cash rate futures imply 78% odds of a 25bps cut to 3.60% at the July 8 meeting and a total of between 75bps and 100bps of easing over the next 12 months."

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

EUR/USD faces next resistance near 1.1930

EUR/USD continues to build on its recovery in the latter part of Wednesday’s session, with upside momentum accelerating as the pair retargets the key 1.1900 barrier amid a further loss of traction in the US Dollar. Attention now shifts squarely to the US data docket, with labour market figures and the always influential CPI releases due on Thursday and Friday, respectively.

GBP/USD sticks to the bullish tone near 1.3660

GBP/USD maintains its solid performance on Wednesday, hovering around the 1.3660 zone as the Greenback surrenders its post-NFP bounce. Cable, in the meantime, should now shift its attention to key UK data due on Thursday, including preliminary GDP gauges.

Gold holds on to higher ground ahead of the next catalyst

Gold keeps the bid tone well in place on Wednesday, retargeting the $5,100 zone per troy ounce on the back of modest losses in the US Dollar and despite firm US Treasury yields across the curve. Moving forward, the yellow metal’s next test will come from the release of US CPI figures on Friday.