Debt ceiling, bank crisis remain concerns
The Australian and New Zealand dollars both jumped back to the top of their recent trading ranges on Friday after a stronger than expected US jobs report boosted US shares.
The US jobs market remains resilient despite the massive increase in US interest rates, with Friday’s reporting beating expectations for the thirteenth-month running.
The April jobs report found 253k new jobs were created last month while the unemployment rate fell from 3.5% to 3.4%.
US shares jumped higher with the S&P 500 up 1.8% while the Nasdaq gained 2.1%. Both markets managed to shrug off the bank concerns that had hit sentiment last week.
AUD leads gains
The AUD/USD led the gains with the pair up 0.8% as it neared the top of its two-month long trading range.
The Aussie outperformed in other markets with the AUD/EUR up 0.8% and the AUD/JPY up 1.3%.
The kiwi was also stronger but underperformed versus the AUD.
The NZD/USD gained 0.2% while the kiwi also gained well in Europe.
Debt ceiling, bank crisis remain concerns
The main focus this week will be US inflation on Wednesday night and the Bank of England on Thursday.
Away from data, global markets remain vulnerable to newsflow around the US debt ceiling and ongoing banking concerns.
While many commentators are hopeful a full-blown bank crisis can be avoided, the impact on the real economy is already seen with tighter lending conditions accompanying a greater reliance on funding from US authorities.
Aussie outperforms after US jobs
Table: seven-day rolling currency trends and trading ranges
Key global risk events
Calendar: 8 – 12 May
All times AEST
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