Weak Jobs Report Drags AUD Lower

AUD

The AUD was lower across most major currency pairs, with the Kiwi pair being the only exclusion. Asian equities closed largely higher with the Hang Seng and the Shanghai Comp outperforming almost 1.2% while the Nikkei closed with a modest gain of 0.6%. The ASX fell a fourth straight session, down 42 points or -0.6% (7,381 points). Commodities were mixed across the board with Iron Ore posting a loss of -1% while both Gold and Silver gained only slightly in the green. In the event on Thursday, the Australian economic docket featured the Labour Data for October which triggered a sell-off across most majors. The Australian Bureau of Statistics revealed the Employment change for October fell 46.3K, a sharp fall from the 50K rise expected by analysts, spurring an increase in the Unemployment Rate, from 4.6% to 5.2%. It’s worth noting that worsening of labour conditions in October was part of the timing of the survey. For reference, the period was late September to early October, when the lockdown restrictions in NSW were just being eased, while Victoria was still in lockdown. It’s a lighter calendar in the Asian session which may allow the Aussie pair sellers to take a breather around the multi-day low.  

USD

The AUDUSD pair dipped below the .73 handle on Thursday and is trading at a rate of 0.7289 at the time of writing. Wall Street was mixed on the close with the Nasdaq outperforming at 0.8% and the S&P up a modest 0.2% while the Dow Jones closed below its peers at -0.4%. Fixed interest markets were closed and was flat on the day. On Thursday, the US economic docket was light due to the observation of the US Veterans Day Holiday. A quiet day ahead to round out the volatile week with a lack of local data among the release until later. The US Jobs and Labour Turnover survey for September released this evening could provide more insight into tightness in the labour market. Job openings remained elevated in August while the private sector quits rate moved to a new all-time high. US Michigan Consumer Sentiment may also be looked additional signals of reflation and Fed rate hike expectations.

EUR

The AUDEUR is trading lower this morning with the pair trading at a rate of 0.6362 this morning. European Equities closed higher on Thursday as global market players digested the latest U.S inflation data which showed persistent price rises. The Germans DAX edged up 0.1% and the CAX gained 0.2%. According to the latest economic forecast on Thursday, the euro area GDP is projected to expand 5% this year, up from the prior outlook of 4.8%. In economic news, ECB Governing Council member Robert Holzmann said on Thursday that the central bank's asset purchase program could end in September 2022 if inflation sustainably returns to the official target. No market reaction to the news. Little in the way of local data headed into the weekend with the EuroZone Industrial Production being the only data of note.

GBP

The AUDGBP followed suit to trade at a loss this morning with the pair trading at a rate of 0.5449 at the time of writing. The FTSE 100 index ended 0.6% higher, helped by China-exposed mining stocks, after China’s Evergrande averted a default at the last minute for the third time in the past month. In the event, the UK economy expanded at a slower pace in the third quarter, the ONS said on Thursday. GDP grew 1.3% in Q3, but weaker than the 5.5% expansion seen in the previous quarter. On a monthly basis, GDP growth improved to 0.6% from revised 0.2% in August. The rate also exceeded the economists' forecast of 0.4%. A lack of local data to close off the week with MPC Member Haskel speak being the only mention.

NZD

The AUDNZD bucked the trend to trade at a marginal gain this morning with the pair trading at a rate of 1.03884. On Thursday, The AUDNZD pair was dragged higher after worse-than-expected jobs data. In the event this morning, Manufacturing activity in New Zealand expanded further in October, a survey showed. The Bank of New Zealand-Business NZ's seasonally adjusted Performance of Manufacturing Index (PMI) rose to 54.3 from 51.4 in the previous month. A reading above 50 indicates an expansion in activity, while anything below that threshold indicates a contraction. There is no local data on the docket to end the week with both antipodeans likely keeping their focus on the upcoming US Data this evening.