Aussie dips below 73 on soft jobs report

The losses continue to mount for the Australian dollar, which is down for a third straight day. AUD/USD is currently trading at 0.7295, down 0.44% on the day.

Australia’s October employment report was soft, with total employment declining and the unemployment rate rising. The economy shed 46.3 thousand jobs, marking a third straight decline. Unemployment rose to 5.2%, up sharply from 4.6%. The markets gave a thumb down to the news, sending the Australian dollar below the symbolic 0.73 level.

Although the job numbers were bad, they are reflective of the lockdowns which have now been lifted in Sydney and Melbourne. As the economy continues to re-open, we can expect employment numbers to rebound and the unemployment rate to decline.

Inflation is on the rise, which may force the RBA to bring forward its guidance on rate hikes. Core CPI has broken above 2%, the RBA’s lower limit of its inflation target. As well, the Melbourne Institute consumer inflation expectations for November surged to 4.6% y/y, the third straight month above the 4% level. If inflation and inflation expectations continue to climb, the RBA will find it difficult to convince the markets that inflation is transitory and may have to make a hawkish shift.  The central bank meets next on December 7th and we could see the bank scale back QE, perhaps from the current AUD 4 billion to AUD 3 billion. If the economy continues to improve, QE could be further scaled back early next year and terminated by mid-2022.

US inflation hits 31-year high

In the US, inflation continues to surge higher. CPI for October rose 6.2% y/y, above expectations and the largest gain since 1990. This sent US 10-year Treasury yields higher and boosted the US dollar, as the data will put pressure on the Fed to raise interest rates sooner than expected, and to accelerate the tapering announced last just last week. The prolonged surge in inflation has become a major headache for the Federal Reserve, and its stance that inflation is transitory is becoming more hollow as PPI and CPI remain red-hot.


AUD/USD Technical

  • There is resistance at 0.7506 and 0.7609
  • AUD/USD has broken below support at 0.7330. Below, there is support at 0.7257, which has held since early October

Content 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 Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at Visit to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.

Kenny Fisher

Kenny Fisher

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental and macroeconomic analysis, Kenny Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in major online financial publications including, Seeking Alpha and FXStreet. Kenny has been a MarketPulse contributor since 2012.