USD lower as JOLTS points to jobs weakness

Greenback slips on rising Fed rate cut bets

The US dollar weakened overnight after the latest JOLTS report showed a sharper-than-expected drop in job openings.

Vacancies fell from 7.36 million in June to 7.18 million in July, marking the first time since 2018 (excluding the pandemic) that openings were outnumbered by unemployed workers.

Markets interpreted the data as a sign of softening labour conditions, increasing the likelihood of a weak non-farm payrolls print on Friday and boosting expectations of a Federal Reserve rate cut in two weeks.

According to Bloomberg, the probability of a cut rose above 90%.

Across markets, the British pound led gains, rebounding from the previous day’s bond-driven losses.

AUD/USD rose 0.4%, while NZD/USD added 0.2%.

In Asia, USD/SGD and USD/CNH were both flat.

AUD edges higher as local economy beats forecasts

Australia’s economy grew 0.6% in Q2, up 1.8% year-on-year, beating expectations and improving on previous figures.

Household and government spending drove the gains, while a drop in public investment capped stronger growth.

Exports, particularly from the mining sector, provided a solid boost.

The Aussie is holding just above short-term support at the 21-day EMA of 0.6507, with additional support at the 50-day EMA of 0.6501.

Traders are eyeing 0.6600 as the next key resistance level.

China’s services surprise lifts sentiment

China’s services sector accelerated in August, with the Caixin services PMI rising to 53, beating forecasts and last month’s reading.

The composite PMI also improved, climbing to 51.9 from 50.8.

These upbeat private survey results contrast with recent official data that pointed to slower momentum.

Despite the positive tone, USD/CNH has ticked higher over the past three sessions, with momentum indicators like Bollinger Bands previously flagging oversold conditions.

Resistance levels are seen near the 21-day EMA of 7.1599 and the 50-day EMA of 7.1741.

Aussie recovers

Table: seven-day rolling currency trends and trading ranges  

Key global risk events

Calendar: 31 August – 5 September

All times AEST

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*The FX rates published are provided by Convera’s Market Insights team for research purposes only. The rates have a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer.