NZD edges back above US$0.62 amid softer US jobs data

Key Movers

The US dollar fell through trade on Wednesday as softer-than-expected JOLTS jobs data spooked investors and elevated calls for a 50-point Fed rate cut. Job openings plunged to their lowest level in 3 years as vacancy rates and the resignation rate declined. The report when coupled with the Fed’s beige book paint a gloomy near-term picture for the US economy. Markets reacted to the jobs data and Beige Book by triggering a steep decline in Treasury yields, driving the USD down against all G10 pairs. The DY and BBDXY indices fell near half a percent while the Japanese yen lead gains, buoyed by the elevated risk aversion.

As anticipated, the Bank of Canada cut rates by 25 basis points and doubled down on its call to expect more easing assuming inflation continues to fall. The decision was largely priced in and had little impact on CAD value as the Canadian dollar edged higher in line with other majors, buoyed by USD softness. With the euro trading back near US$1.11 and Sterling just south of US$1.3150, our attentions turn to US ISM services data and ADP employment numbers as key indicators of US macro health leading into tomorrow critical non-farm payroll print.