A$ Aided By Jobs Beat/Equity Gains, Offsetting Further Iron Ore Losses

AUD gains have dominated the G10 FX space in the first part of Thursday trade. This followed stronger than expected jobs growth figures, which offset a rise in the unemployment rate. We have seen a slight risk on tone amid regional equity gains (and higher US futures), although JPY and CHF aggregate moves are close to flat.

• AUD/USD was weaker ahead of the jobs report, but found some support ahead of 0.6570. We last tracked near 0.6625/30, +0.40% and close to session highs. The surge in full time jobs led the aggregate employment rise, while the higher participation rate drove the unemployment rate higher. A still strong labor demand backdrop should keep the RBA on hold.
• Mixed China data also printed, with the market likely taking some relief from the slight improvement in retail sales, although IP and fixed asset investment were sub expectations. China equities have bounced from multi month lows, another positive for the A$.
• Iron ore prices continue to track lower though, down 2% to sub $94/ton. The weaker than forecast industrial for China in July likely adding to recent headwinds in this space.
• NZD/USD is up from earlier lows, last near 0.6005. Earlier data showed quite weak July card spending figures, in line with the RBNZ's concerns around current growth momentum. Monthly food and other inflation figures were mixed. RBNZ Governor Orr stated that further easing is likely in a careful/measured pace (BBG).
• Japan Q2 GDP was better than forecast, although didn't provide lasting positive impetus to the yen. USD/JPY was supported at 147.15, but topped out above 147.60. We last tracked near 147.30, little changed for the session. USD/CHF is near 0.8660, also close to unchanged.
• Later the Fed’s Musalem and Harker speak and US July retail sales, August Empire & Philly Fed Indices, July trade prices, IP, inventories and jobless claims print. There are also UK June GDP, IP, trade & Q2 GDP.