AUD/USD drops through 0.70

 

Weak building data cements slide

AUD/USD traded below the psychological 0.70 mark late yesterday and the FX pair moved even lower this morning, pressured by weak building permits data. AUD/USD traded to the lowest since January 3, the day of the mini flash crash, after the data. Yesterday’s close below 0.70 was the first time since January 2.

Building permits fell 15.5% m/m, a larger drop than the -14.0% economists had expected and almost wiping out the 19.1% gain posted in February. The data again questions the state of the Australian housing market, which has seen prices in major cities Sydney and Melbourne drop 10% in the year to April.

 

AUD/USD daily Chart

Source: OANDA fxTrade

 

Nonfarm payrolls to headline

April’s US employment report is due later today and will no doubt be the highlight of a busy week. Economists forecast that the US economy added 185,000 jobs last month, less than the 196,000 recorded in March and below the six-month moving average of 207,000.

 

Dollar could rip higher with a stellar NFP report

 

The unemployment rate is seen holding steady at 3.8% while average hourly earnings are expected to climb 0.3% m/m.

Aside from the US jobs report, we get to see US wholesale inventories for February, the goods trade balance for April and US ISM services PMIs from Markit and ISM for the same month. Recall the manufacturing sector put in a mixed performance with the Markit reading improving to 52.6 but the ISM reading deteriorating to 52.8.

 

The full MarketPulse data calendar can be viewed at https://www.marketpulse.com/economic-events/

 

 

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Andrew Robinson

Andrew Robinson

Senior Market Analyst at MarketPulse
A seasoned professional with more than 30 years’ experience in foreign exchange, interest rates and commodities, Andrew Robinson is a senior market analyst with OANDA, responsible for providing timely and relevant market commentary and live market analysis throughout the Asia-Pacific region. Having previously worked in Europe, since moving to Singapore he worked with several leading institutions including Bloomberg, Saxo Capital Markets and Informa Global Markets, proving FX strategies based on a combination of technical and fundamental analysis as well as market flow information. Andrew began his career as an FX dealer with NatWest and the Royal Bank of Scotland in the UK.