Global Themes

Jobs miss

The USD fell on Friday after the critical US jobs report missed market forecasts.

A smaller than expected 164k new jobs were created in April despite a big fall in the US unemployment rate which dropped to a 17-year low of 3.9%.

Importantly, wage growth numbers also missed expectations in another sign that inflation remains resolutely stuck below the US Federal Reserve’s target.

The US jobs number saw the US dollar weaken again on Friday after the greenback’s recent strong rally saw the USD index up 4.1% in three weeks.

AUD higher

The euro weakened as it neared 2018 lows after a poor activity numbers across Europe pressured the currency.

The pound also fell ahead of this week’s meeting of the Bank of England.

The AUD was helped higher as Friday’s Statement of Monetary Policy from the Reserve Bank of Australia maintained its positive assessment of the local economy with a buoyant forecast for 2018 economic growth at 3.25%.

US inflation in focus

This week, US inflation, due on Thursday, is likely to be the big driver.

Otherwise, Chinese trade balance and the Fed’s Jerome Powell are both due on Tuesday, and the Bank of England meeting, on Thursday night, will be this week’s other major events.

Deliver the Daily Currency Market Analysis to my Inbox

Published five days a week, this newsletter provides day-to-day trends and activities affecting the market in easy-to-understand snapshots