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Greenback Weakness Extends Ahead Of The Close, AUDUSD Up 3%

FOREX
  • Friday saw a broadly solid US employment report for October, despite a small miss on the unemployment rate. Despite further solid job gains, the US dollar saw a sharp depreciation on Friday with strength in both equity markets but especially in the commodity complex working against the greenback for the majority of Friday trade.
  • Potentially one of the dominant drivers were early headlines about possible easing of China covid curbs attracting dip buyers in equities following the data, weighing on the US Dollar, with price action being exacerbated by short-term positioning.
  • The USD index is down just shy of two percent and gains in G10 were broad based. CNH is set to post one of its largest advances on record at 2.10%, which certainly filtered through to the likes of AUD and NZD, rising well over 2.5%.
  • In similar vein, EURUSD (+2.10%) bounced two full points to trade back above 0.9950 and GBPUSD (+1.85%) reversed the majority of yesterday’s fall which had been pronounced by the Bank of England’s latest downbeat statement.
  • Focus next week turns the US Midterm Election and to Thursday’s US CPI print, which may prove pivotal in determining pricing ahead of the December Fed meeting given many Fed officials have been hinting the pace of rate hikes may need to decelerate, despite also signalling a higher terminal rate.
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  • Friday saw a broadly solid US employment report for October, despite a small miss on the unemployment rate. Despite further solid job gains, the US dollar saw a sharp depreciation on Friday with strength in both equity markets but especially in the commodity complex working against the greenback for the majority of Friday trade.
  • Potentially one of the dominant drivers were early headlines about possible easing of China covid curbs attracting dip buyers in equities following the data, weighing on the US Dollar, with price action being exacerbated by short-term positioning.
  • The USD index is down just shy of two percent and gains in G10 were broad based. CNH is set to post one of its largest advances on record at 2.10%, which certainly filtered through to the likes of AUD and NZD, rising well over 2.5%.
  • In similar vein, EURUSD (+2.10%) bounced two full points to trade back above 0.9950 and GBPUSD (+1.85%) reversed the majority of yesterday’s fall which had been pronounced by the Bank of England’s latest downbeat statement.
  • Focus next week turns the US Midterm Election and to Thursday’s US CPI print, which may prove pivotal in determining pricing ahead of the December Fed meeting given many Fed officials have been hinting the pace of rate hikes may need to decelerate, despite also signalling a higher terminal rate.