Stronger-than-expected US jobless claims and geopolitical tensions lift the USD, pressuring the Australian Dollar despite solid domestic employment data.
AUD/USD retreated to near 0.6970 on Thursday, erasing earlier gains as the USD strengthened following robust US labor market data. US Initial Jobless Claims dropped to 187K for the week ending July 18, below the 212K forecast and a revised 209K prior, reinforcing labor market resilience and supporting Treasury yields.
Geopolitical tensions added to USD demand after remarks from US President Donald Trump heightened uncertainty. Domestically, Australia’s June employment report showed a 76.3K rise in jobs, exceeding the 15K estimate, with unemployment steady at 4.4%.
Traders now await Australia’s July PMIs, with expectations for a slight dip in the Composite index to 50.4. Stronger readings could stabilize the AUD, while weaker data may extend its decline.