Australian Dollar
Expected Range 0.7270 – 0.7410
The Australian dollar rallied into the close on Friday bouncing higher following softer than anticipated US labour market data. The world’s largest economy added just 38,000 Jobs through May, its slowest pace of labour market growth in over 5 years. The poor print all but cancelled out any chance of a June rate hike and severely hampered market expectations for a policy shift in July. The Aussie dollar stormed through 0.73 U.S cents rallying some 130 points and touching intraday highs at 0.7370. Attentions now turn to The RBA and Tuesday’s rate announcement and accompanying monetary policy statement. With a strong expectation the board will refrain from cutting rates across consecutive months attentions will be broadly drawn to the accompanying policy statement for direction and affirmation the RBA will maintain its bearish bias.
New Zealand Dollar
Expected Range 0.6880 – 0.7010
The New Zealand dollar rallied through trade on Friday buoyed by weaker than expected U.S employment data. The worst non-farm payroll print for five and a half years sent the Greenback tumbling across the board and the Kiwi surged upward, advancing 120 points into the close. Touching intraday highs at 0.6954 the NZD recouped most of the losses suffered through the last month and attentions turn to Thursdays RBNZ rate announcement and monetary policy statement. With the board expected to maintain its current neutral policy stance there is scope the Kiwi could reclaim 0.70.
Great British Pound
Expected Range 1.9500 – 2.0100
The Great British Pound managed to recoup some of the week’s earlier losses bouncing back through 1.45 after U.S labour market data fell well short of investor and analysts’ expectations. The worst non-farm payroll print in five and half years sent the dollar tumbling across the board and Sterling surged upward touching intraday highs at 1.4564. With little of note on the domestic docket through trade on Monday focus shifts back to Brexit deliberations as the referendum looms ever closer.
Majors
Expected Range N/A
The U.S dollar tumbled against a basket of major currency counterparts through trade on Friday, marking is biggest one day decline in more than 3 months following a softer than anticipated labour market and jobs report. Friday’s non-farm payroll numbers showed the U.S economy added just 38,000 jobs in May, the slowest pace of labour market growth in over 5 years. While the numbers were somewhat distorted by striking Verizon employee’s the print is still well below market expectation and when coupled with a marked decline in the participation rate investors were left scrambling to adjust interest rate expectations. The dismal print all but slammed the door shut on a possible June interest rate adjustment and dramatically decreased investors’ expectations for policy action come July. Fed Funds Futures, a measure of market expectations, fell sharply on Friday falling to 37% down from 60% on Thursday. The weak report goes against recent macroeconomic indicators and makes it difficult for Fed to justify raising rates in the near term. Investor focus now shifts to Fed Chair Janet Yellen as she addresses the market with investors keenly attuned to any shift in rhetoric following her hawkish assessment little over a week ago.