Australian Dollar Boosted by Latest US Jobs Data

Australian Dollar (AUD) Benefits from Record US Jobs Data

The Australian Dollar (AUD) remained flat but rallied against the US Dollar as risk appetite was buoyed by upbeat US jobs data.

The US economy created jobs at a record rate, with 4.8 million jobs added in June. Sentiment was also boosted after reports a Covid-19 vaccine being developed by BioNTech and Pfizer had shown potential during early human trials.

Looking ahead, the ‘Aussie’ could receive further support if today’s CommBank services PMI and PMI composite rebound as services return to growth in June. Upbeat retail sales could also provide AUD with a boost.

Pound (GBP) Traders Focus on UK-EU Trade Talks

The Pound (GBP) edged higher on Thursday, supported by a weaker US Dollar but remaining largely flat against the Euro.

Traders focused on the likelihood of the UK reaching a deal with the EU by the end of the year, and with this month being crucial for GBP, traders appear pessimistic on hopes of a breakthrough in talks.

Looking ahead, Sterling could edge higher following the release of the UK services PMI, if the index suggests the country’s largest sector is close to retuning to growth and the no-change 50 mark.

Euro (EUR) Muted as Unemployment Rises

The Euro (EUR) remained largely flat during Thursday’s session after data revealed unemployment in the Eurozone edged up less than expected in May, staying near April’s levels. Added to this, separate data from Italy showed the country’s unemployment rate rose, capping any positives that could be taken from the Eurozone data.

Looking ahead, the single currency could slide today following the release of PMI data from the bloc. If the Eurozone’s services PMI disappoints and remains firmly in contraction territory, it will send EUR lower.

US Dollar (USD) Slides After Record Increase in Non-Farm Payrolls

The US Dollar (USD) slumped after the latest non-farm payrolls data revealed the United States added a higher-than-expected 4.8 million jobs to the economy in June.

This sent the country’s unemployment rate down from 13.3% to 11.1%, suggesting the country’s economy is healing from the economic impact of the coronavirus crisis. This boosted risk appetite and sent traders flocking away from the safe-haven ‘Greenback’.

Looking ahead, the Dollar could extend yesterday’s losses if risk appetite continues to increase at the end of the week.

Canadian Dollar (CAD) Flat as Manufacturing PMI Jumps to Four-Month High

The Canadian Dollar (CAD) remained under pressure on Thursday despite oil prices rising after a fall in oil stockpiles offset the spike in US coronavirus cases and revival of lockdown measures in California.

However, the latest Canadian manufacturing PMI jumped to a four-month high in June, providing signs of a turnaround in the sector which offered some support.

Looking ahead, the ‘Loonie’ could regain some losses if oil prices continue to rise at the end of the week.

New Zealand Dollar (NZD) Rallies as Risk-On Mood Dominates

The New Zealand Dollar (NZD) benefitted on Thursday thanks to an upswing in risk appetite.

Upbeat US jobs data defied expectations and saw the world’s largest economy create jobs at a faster than expected pace in June. US nonfarm payrolls posted the largest increase in jobs since the government started to keep records. If risk appetite continues to rise, the ‘Kiwi’ could continue to benefit as traders flock to riskier assets.

Louisa Heath

louisa.heath@torfx.com


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