Australian Dollar Hits 7-Week Low
The Australian dollar weakened to around $0.70, hitting its lowest in seven weeks after the latest labor market figures tempered expectations of further interest rate hikes. The jobless rate rose to 4.6%, above forecasts of a steady 4.5% and the highest since late 2021, while the economy added 39,500 jobs versus a predicted 20,000 increase. The report was the final major economic release before the RBA’s September 28—29 meeting and showed signs of softening in a labor market the central bank has described as still “a bit tight,” potentially easing domestic inflation pressures. Markets still price an 86% chance of a 25-bp hike to 4.60% in September, down from 95% before the jobs report, while the odds of another hike fall to 44% for November. Elsewhere, the firmer US dollar added pressure on the Aussie as stronger-than-expected economic data reinforced bets for further Fed rate hikes. Rising oil prices also dampened global risk sentiment after Iran cast doubt on progress in peace talks.
70, hitting its lowest in seven weeks after the latest labor market figures tempered expectations of further interest rate hikes. 5% and the highest since late 2021, while the economy added 39,500 jobs versus a predicted 20,000 increase. The report was the final major economic release before the RBA’s September 28—29 meeting and showed signs of softening in a labor market the central bank has described as still “a bit tight,” potentially easing domestic inflation pressures. 60% in September, down from 95% before the jobs report, while the odds of another hike fall to 44% for November.
Elsewhere, the firmer US dollar added pressure on the Aussie as stronger-than-expected economic data reinforced bets for further Fed rate hikes. Rising oil prices also dampened global risk sentiment after Iran cast doubt on progress in peace talks.