Strong US Dollar demand on 82% odds of a Fed rate hike this year pressures the Australian currency despite solid jobs data.
The AUD/USD pair fell to near 0.6890 in European trading Thursday, extending losses as the US Dollar strengthened on hawkish Federal Reserve expectations. The US Dollar Index hovered around 101.55, close to its 2024 high of 101.80 reached Wednesday.
Australia’s May jobs report showed a stronger-than-expected gain of 40.3K positions, surpassing the 25K estimate, while the unemployment rate dropped to 4.4%. However, April’s job losses were revised higher to 40.7K from 18.6K. Investors now await US PCE inflation data for further Fed policy clues.
Technical analysis indicates a bearish bias for AUD/USD, with the pair trading below its 20-day EMA at 0.7025.