AUD / USD Climbs To 0.6640 On Upbeat Australian Employment

As a result of the Australian Bureau of Statistics' upbeat Employment data, the AUD / USD pair has extended its recovery to near 0.6640. In February, the Australian economy added 64.6K new jobs, exceeding the consensus estimate of 48.5K. The Australian economy reported 11.5K layoffs in January. The Unemployment Rate has been further reduced to 3.5% from estimates of 3.6% and the previous release of 3.7%.

The Reserve Bank of Australia (RBA), which is drafting a plan to reduce inflation, will face additional challenges as a result of positive Australian labor market data. RBA Governor Philip Lowe may continue to target higher rates, as a larger labor force in action would exacerbate inflationary pressures.

Earlier, Australian Consumer Inflation Expectations (Mar) data indicating inflation projections for the next 12 months decreased to 5.0% from the consensus of 5.4% and the previous release of 5.1%.

In the meantime, S&P500 futures are showing modest gains during the Asian session, which could be considered a dead cat rebound following Wednesday's volatility. The debacle of Credit Suisse following the Silicon Valley Bank (SVB) failure has increased the risk of global banking turmoil. One school of thought holds that the Federal Reserve (Fed) and other western central banks' rapid and precipitous interest rate increases contributed to the collapse of the global banking system.

The US Dollar Index (DXY) is seeking to extend its correction below 104.60 as investors anticipate a less hawkish interest rate decision from the Federal Reserve (Fed) next week. The United States' inflation has redirected south after a brief uptick in January, dampening expectations for a hawkish posture from Fed chair Jerome Powell.