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MTrading Team • 2023-01-19

AUDUSD slumps on downbeat Aussie jobs report, ignores softer USD

AUDUSD slumps on downbeat Aussie jobs report, ignores softer USD

Global markets remain dicey as Treasury bond yields extend post-BOJ slump amid mixed headlines. Even so, the US Dollar pares the weekly gains as softer data fails to back the hawkish comments from Federal Reserve officials.

The recession woes regained attention and weighed on the Oil prices but the softer USD underpinned the Gold’s rebound. Further, stocks in the Asia-Pacific region traded mixed but the US stock futures tracked negative closing of Wall Street due to economic fears.

AUDUSD justifies its risk-barometer status, as well as disappointing Aussie employment data, to lead the bears. Further, the USDJPY occupied the other end even as Japanese export numbers declined. On the same line, GBPUSD printed mild losses as UK’s softer jobs report and inflation numbers joined workers’ strike-linked fears.

Elsewhere, BTCUSD and ETHUSD grind higher as the softer greenback joins the optimism surrounding the crypto markets for 2023.

Following are the latest moves of the key assets:

  • Brent oil keeps the previous day’s pullback from six-week high near $84.30.
  • Gold prints the first daily gains in four, up 0.40% intraday near $1,912 at the latest.
  • USD Index prints the first daily loss in four and pares weekly gains around 102.25.
  • Wall Street closed in the red but stocks in the Asia-Pacific region, as well as equities in Europe and the UK, trade mixed at the latest.
  • BTCUSD and ETHUSD print mild gains around the multi-day high, close to $21,000 and $1,550 as we write.
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Mixed sentiment, downbeat data weigh on the USD

The USD Index prints the biggest daily loss in a week while snapping a three-day uptrend as disappointment from the US Retail Sales and Producer Price Index (PPI) bolstered fears of a recession in the world’s largest economy. The same joins downbeat Treasury bond yields to exert downside pressure on the greenback.

Australia’s December Employment Change and Unemployment Rate disappointed AUDUSD traders while USDJPY slumped due to the softer yields and hopes that BoJ isn’t off the policy hawk’s radar as Governor Haruhiko Kuroda will retire in April. Further, GBPUSD also suffers from economic pain, mainly due to the employment and inflation fears, but couldn’t materialize hawkish bias over the Bank of England.

Gold prices grind higher as the market’s confusion and softer USD drive traders toward the traditional safe-havens, namely the Gold and JPY. Even so, Brent oil dropped for the second consecutive day as hopes of China demand fall short of overcoming US recession concerns.

That said, hopes of more NFT growth join the sigh of relief that the worst is over for Cryptos to underpin the latest recovery in the BTCUSD and ETHUSD.

  • Strong buy: GBPUSD
  • Strong sell: ETHUSD, USDJPY
  • Buy: USD Index, USDCAD, Nasdaq, EURUSD
  • Sell: DAX, FTSE 100, gold, BTCUSD, AUDUSD

Nothing major on the table

Although ECB President Lagarde’s speech will lead the central bankers’ comments and can entertain traders, together with the second-tier US data, an absence of major statistics/events could allow markets to extend the recently mixed momentum and may weigh on the USD. However, Wall Street’s close will be crucial to watch and so do the movement of Treasury bond yields amid recession talks.

May the trading luck be with you!