AUD very much down under

The AUD took a beating overnight, subsequently trading to a fresh 3-year low following a weak jobs report that saw employment fall 22.6k from an expected 10k rise and a previous month’s gain of 21k. The unemployment rate remained at 5.8% as expected but with the damage seemingly seen in the full time component that dropped 31.6k from a rise of 15.5k in the previous month. The market is speculating that this could be the final piece of data that will push the RBA to the rate cut they have had in reserve.

Risk trade has been constructive, with the dollare trading with a bid tone following another all-time high in the S&P above 1850 as Federal Reserve officials have been vocal in stressing that the benign jobs report for December will have no effect on the US economy and their decision to taper.

Today’s data will all be about inflation with the EU final HICP data this morning along with CPI data from across the pond this afternoon along with the Philadelphia Fed survey as we await comments from outgoing Chairman Bernanke after the European close.

EUR/USD

Supports 1.3565-1.3545-1.3525 | Resistance 1.3635-1.3700-1.3735

USD/JPY

Supports 104.45-104.15-103.50 | Resistance 104.90-105.15-105.50

GBP/USD

Supports 1.6300-1.6260-1.6220 | Resistance 1.6400-1.6465-1.6500

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