The Australian dollar could not maximize the slightly hawkish monetary policy statement of the Reserved Bank of Australia, where the core message was tackling inflations by every necessary means. Markets appear to have focused on the downside risks to the broader global outlook reiterated by the Bank of England yesterday, leaving the Australian dollar vulnerable. Most emerging currencies are down against the greenback, USD today showing investor appetite for risk is low.
This being said, yesterday’s strong balance of trade figures showed a continued rise via commodity exports while commodity prices themselves are largely elevated across the board.
Moving forward, the Non-Farm Payroll (NFP) release grabs headlines and will indicate the state of the U.S. labor market. The market is also considering the average hourly earnings to see whether or not inflationary pressure is declining.