Aussie, kiwi turn from two-week highs
The US dollar climbed from recent lows on Friday after the January jobs report continued to signal a strong jobs market that could cause the Federal Reserve to delay any potential interest rate cuts.
While the headline number was below expectations – at 143k versus the 170k expected – the unemployment rate fell from 4.1% to 4.0% while average earnings continued to show strength with a 0.5% gain over the month.
Additionally, the December report was revised up from 256k to 307k.
The US dollar index climbed from two-week lows on Friday as the job report impacted on Fed expectations.
In local markets, the AUD/USD fell only moderately, down 0.2% as it turned from recent resistance at 0.6300 at the two-week highs.
Similarly, the NZD/USD also fell 0.2% as it also reversed from two-week highs.
In Asia, the USD/SGD climbed from a second day with the pair up 0.3%,
The USD/CNH also gained for second day with a 0.2% gain.
US inflation and global growth data to guide markets
Looking to the week ahead, USD volatility is likely around Thursday’s US CPI and Friday’s PPI. Saturday’s retail sales will test consumer demand trends.
Strong prints could bolster bets on Fed rate stability –extending the greenback’s recent rebound.
Tuesday’s Westpac Consumer Confidence and NAB Business Confidence will highlight domestic risks for the AUD. Weakness here may revive RBA easing speculation, pressuring the currency amid sluggish growth signals.
Thursday features Germany’s final CPI and EU industrial production, while Friday reveals Eurozone GDP. Disappointments here may amplify EUR and GBP volatility.
GBP weaker in Asia ahead of UK jobs report
In European markets, today sees the release of the UK Report on Jobs from S&P Global, REC and KPMG.
The permanent placements index continued to decline, currently below 40, according to the December report. Although it increased by 0.5 percentage points to 53.1, the salaries index is still at its average level from the preceding four months.
The GBP/USD has recently been trapped within a clear trading range between 1.2400 and 1.2550 with major support seen lower.
In Asia, this consolation has seen the GBP underperform, with the AUD/GBP at two-week highs and GBP/SGD at three-week lows.
Aussie, kiwi turn from recent resistance
Table: seven-day rolling currency trends and trading ranges
Key global risk events
Calendar: 9 – 15 February
All times AEDT
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*The FX rates published are provided by Convera’s Market Insights team for research purposes only. The rates have a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer.
