Risk Appetite Offsets Poor Aussie Jobs Data

AUD

The Australian Dollar opens flat against the majors this morning, as unconfirmed reports that Iran and the U.S had reached a draft agreement helped the Aussie Dollar recover following our poor employment figures that were released yesterday.  The figures showed unemployment jumping from 4.3% to 4.5% in April, which is the highest since November 2021. Australia's labour market deteriorated more than expected, with employment falling by 18,600 jobs against forecasts of a 17,500 gain. Markets now predict the RBA to keep rates on hold in June, with a hike in August still on the cards. Asian equities were mixed on Thursday with the Nikkei +3.1%, the Shenzhen -1.4%, and the Hang Seng -1.0%. Locally the ASX rebounded +1.5% with materials and real estate leading the way, gaining 2.6% and 2.2% respectively. Nothing set for release locally to end the week with our next major release set for the 27th with our CPI data.

USD

AUDUSD opens flat at 0.7152 as US weekly jobless claims data released largely in line with expectations, with initial claims at 209k (210k forecasted). The second round of U.S. data saw Manufacturing PMI for May at 55.3 (53.8 forecasted) and Services PMI at 50.9 (51.2 forecasted). The mixed results saw the composite PMI steady at 51.7 against estimates of an increase to 51.8. Risk related assets moved higher on the back of unconfirmed reports that Iran and the U.S had reached a draft agreement through Pakistani mediators that would be announced within hours. Wall St. unaffected by the final headlines and closing higher on the day with the Dow Jones +0.6%, the S&P500 +0.2% and the Nasdaq +0.1%. There will be another round of US data releases later this evening with Revised UoM Consumer Sentiment and FOMC Member Waller will be speaking on the economic outlook at the Centre for Central Banking in Frankfurt.

EUR

AUDEUR opens flat this morning at 0.6154 after yesterdays Eurozone PMI’s largely missed the mark with only German service PMI’s coming through higher than forecasted. France's private sector economy suffered its sharpest contraction in five-and-a-half years during May. Eurozone equities also closed in the red with the DAX -0.5%, and the CAC -0.4%. Nothing major out of the Eurozone today however the ECOFIN and Eurogroup Meetings will be happening all day. 

GBP

AUDGBP opens flat this morning at 0.5323 following mixed PMI’s results, with the data showing a boost in manufacturing at 53.7 (forecasted 52.9), services however missed forecasts heavily coming in at 47.9 (forecasted 51.7). UK equities closed in the green with the FTSE +0.1%. Looking at UK news later this afternoon we will get the release of Retail Sales m/m which is forecasted to fall heavily from 0.7% to -0.6%. 

NZD

AUDNZD opens slightly lower this morning at 1.2166 after NZ Core Retail Sales q/q and Retail sales q/q came through higher than forecast with Core coming in at 1% from 0.8%, while Retail Sales q/q came through at 0.9% from 0.5%. Nothing else set for release today, with markets now focused on the RBNZ's rate decision next Wednesday.