Post by: PocketOption on Jan 17, 2025, 05:18 am
Strong US nonfarm payrolls sends Aussie tumbling
The week ended with a surprisingly strong US jobs report. In December, the economy added 256 thousand jobs, the most since March 2024. This followed a downwardly revised 212 thousand in November and easily beat the market estimate of 160 thousand. The unemployment rate eased to 4.1%, down from 4.2% in November. Wage growth also ticked lower, from 4% y/y to 3.9% and from 0.4% to 0.3% monthly.
The upshot of the jobs report is that the US labor market remains solid and is cooling slowly. For the Federal Reserve, this means there isn’t much pressure to lower interest rates in the next few months. That will suit Fed policy makers just fine as it awaits Donald Trump, who has pledged tariffs against US trading partners and mass deportations of illegal immigrants. Either of those policies could increase inflation and the Fed will try to get a read of the Trump administration before cutting rates again. The latest Fed forecast calls for only two rate cuts in 2025 but that could change, depending on inflation and the strength of the labor market.
The strong employment numbers boosted the US dollar against most of the majors on Friday and the Australian dollar took it on the chin, falling 0.8%, its worst one-day showing in three weeks. With interest rates likely on hold in the near-term and high tensions in the Middle East, the safe-haven US dollar should remain attractive to investors in the coming months.
AUD/USD Technical
- AUD/USD tested resistance at 0.6163 earlier. Above, there is resistance at 0.6188
- 0.6121 and 0.6096 are providing support
Source: AUD/USD stabilizes after post-NFP slide (https://www.marketpulse.com/news-events/central-banks/aud-usd-stabilizes-after-post-nfp-slide/kfisher?utm_source=rss-feed&utm_medium=rss&utm_campaign=feed)