AUD On The Slide After Mammoth Job Gains
It is all about the USD again this morning the usual suspects are under the hammer. At this stage, it is about following the flow and when looking at the Chinese Yuan rate, we can see a fresh surge in the upside is leading to follow-on price action across the board. As it stands, it is not clear who, why and what is behind the flow, although it is clearly having an impact on the market.
AUD has slid back under 0.7400 again this morning, with traders seemingly having ignored the sharp rise in jobs last month. The June report showed a gain of nearly 51k jobs, so this will be welcome news for the RBA who are waiting for some follow through in wage growth as a result. They may have to wait a little longer as the report also suggested there is still slack in the (labour) market and this is borne out in the unemployment rate sticking to 5.4% - unchanged from May.
Once again we saw the AUD/USD rate stalling at recent highs, with sellers fading the move in Asia into 0.7440-50. This morning, after some stability above 0.7400, London traders have reacted to the moves in the Chinese on and offshore Yuan rates and the rest is history. For AUD/USD, this means a possible retest of the Wednesday lows seen under 0.7350, with its NZD counterpart also hit lower again to keep the 0.6725-30 support in the line of fire.