Australian Job Data Hits AUD and NZD Hard

Traders are nearing the end of a busy week of central bank decisions, with major monetary policy updates shaping market sentiment. Yesterday, the Federal Reserve confirmed that two rate cuts remain on the table for 2024, as stated by Jerome Powell. However, after the dust settled, the US dollar strengthened, suggesting that markets are still cautious about the exact timing of those cuts.

Today’s session brought another rate cut—this time from the Swiss National Bank (SNB), which lowered rates by 25 basis points. The move was expected, but the Swiss franc weakened in response. Meanwhile, the Bank of England (BoE) left rates unchanged at 4.5%, with no major surprises in its statement. With this, the central bank-heavy week is coming to an end, and traders are now looking ahead to Friday’s quiet calendar, with only Canadian retail sales data left to watch.

Stock markets remain mixed, with European indices struggling, particularly the DAX, which saw a sharp decline. US indices, on the other hand, are trying to recover, despite a volatile session during European hours. A bullish reversal in the early American session has lifted Dow Jones, S&P 500, and NASDAQ, but the question remains whether this rebound will hold into the weekend.

Currency markets reflect a shift toward safe havens. The yen is strengthening, alongside the US dollar and Canadian dollar, while Australian and New Zealand dollars are significantly weaker. The drop in Antipodean currencies is largely due to disappointing Australian job data, which missed expectations overnight and added pressure on the already struggling AUD and NZD.

In commodities, metals are moving sideways, with gold and silver holding near their long-term highs but lacking momentum for further gains. Oil, on the other hand, is pushing higher, showing some renewed optimism after a rough start to the week. If this bullish move continues, oil may close the week in positive territory, marking one of its few winning weeks in recent months. However, Friday’s session will ultimately determine whether this rally holds.

Source: https://www.axiory.com/analytics/market-news/australian-job-data-hits-aud-and-nzd-hard