A$ Hits Fresh Lows Post Wages Miss

AUD/USD posted fresh lows under 0.6990, post the weaker than expected wages outcome. We have stabilized somewhat now, back above this level, but remain around 0.4% below NY closing levels and not surprisingly the currency is underperforming on crosses. The wages print continues the recent run of disappointing outcomes relative to expectations. This is the third quarter in a row where the print has come in below economist expectations for the QoQ outcome. -0.10% for Q2, -0.15% for Q1 and -0.05% for Q4 last year. The YoY reading at 2.6% was in line with RBA estimates from the latest SoMP though. Onshore AU yields given up a chunk of their earlier gains. The 2yr is back to 2.70% from 2.74% prior to the print, driving the AU-US 2yr spread back to -51bps.