AUD Keeps Bullish Outlook Unchanged

AUD

The Australian Dollar opens mixed against the majors following  varied CPI data release results yesterday. CPI y/y softened to 3.4% but the underlying trimmed mean rose 0.3% which exceeded market expectations keeping RBA rate hike prospects alive. On the equity front, the ASX 200 ended 0.2% higher as technology and materials led gains of 1.5% and 1.3% respectively, contrasting with a mixed Asian session where the Nikkei fell 1% and the Hang Seng dropped 1.2% amid rising China-Japan trade tensions. Looking ahead, focus shifts to the Australian Trade Balance data today.
 

USD

The AUD/USD pair is currently holding firm at 0.6722, sitting at its highest levels since October 2024 as the Greenback faces broad-based pressure. Disappointing labor data has been a catalyst, with JOLTS job openings falling to 7.15M and ADP Non-Farm Employment Change missing expectations of 49k coming in at 41k. Although the economy showed resilience elsewhere as ISM Services PMI data jumped to 54.4 which was expected at 52.2. •    A mixed session on Wall St. saw the Dow Jones trading -.6%, the Nasdaq +.5% and the S&P 500 -.1% late in the North American day.  U.S. 10-year yields fell 4bps to 4.14%, while Brent Crude fell 1.3% to $59.95 a barrel. Markets are now shifting their attention to the US Unemployment Claims report due tomorrow night, which will likely define the USD's trajectory for the remainder of the month..

EUR

The AUD/EUR cross is trading at 0.5757, marking its highest level in nine months as the Euro struggles against a backdrop of deteriorating consumer activity and cooling price pressures. German Retail Sales slumped 0.6% month-on-month, significantly missing growth forecasts, while Eurozone Core CPI eased to 2.3%, fueling speculation that the ECB may lean more dovish than its global peers. European equity markets were up with the DAX at +0.9% and the CAC in flat at 0.0%. Traders are now monitoring continental unemployment figures today for signs of a deepening regional slowdown ahead of tomorrow’s final inflation revisions.
 

GBP

The AUD/GBP cross is actively testing the 0.5000 psychological milestone opening at 0.4994. The FTSE 100 tracked this domestic weakness to close 0.7% lower as the widening economic gap between Australia's robust materials sector and the UK's struggling construction industry continues to drive the cross higher. With the UK data calendar relatively light today, the market remains focused on Bank of England commentary to see if the recent economic softness prompts a more dovish policy shift.
 

NZD

The AUD/NZD cross continues its run, opening at 1.1641 and maintaining its highest level since 2013. Market participants are now looking toward tomorrow's Chinese inflation data as the next major catalyst for the Kiwi dollar given New Zealand's heavy trade exposure.