Another wave of US Dollar (USD) strength post last week’s Non-Farm Payroll release has sent the Australian Dollar (AUD) lower, extending last week’s bear run from 0.6540 to around the 0.6300 zone in thin US Holiday trading. US equity market indices moved sharply lower in the wake of Friday’s NFP release, the data showing 263k jobs were added to the economy in September – better than expected while the Unemployment Rate unexpectedly improved from 3.7% to 3.5%. This data made the Fed more hawkish than they already were, reinforcing an argument for the Fed’s need to raise rates hard in order to fight inflation without taking the heat for pressure of a worsening job’s market. Markets predict the Fed to raise rates 75 points early November. Looking ahead we have US CPI y/y Friday which is predicted to come in lower from the current 8.3% at 8.1%. Further falls predicted through 0.6000 in the medium term.
Current Level: 0.6264
Resistance: 0.6540
Support: 0.6000
Last Weeks Range: 0.6352-0.6545