Help
USD at August highs, markets await key US data
Retail sales and jobless claims are in focus as markets weigh the impact of consumer spending against labor market conditions
AUD climbs on positive labor data, easing RBA rate cut outlook
Gold and silver rise on central bank rate cut bets
WTI crude dips as supply concerns ease
Currencies
In early trading, the Australian dollar emerged as the strongest currency, bolstered by better-than-expected employment data. AUD/USD reaching 0.6694, as Australia’s labor market continues to outperform forecasts. Employment surged by 64.1k in September, far surpassing the anticipated 25.2k increase, while the unemployment rate edged down to 4.1%, slightly lower than the expected 4.2%. This sustained labor market strength prompted investors to adjust their expectations for interest rate cuts from the Reserve Bank of Australia, pushing the AUD to further gains.
In contrast, the Swiss franc lagged. Market volatility in the currency market space remained modest, with no significant developments driving extreme movements at the moment.
Precious Metals
Gold surged to new highs, supported by a blend of factors, including expectations for rate cuts from several central banks and heightened geopolitical tensions. Softer inflation readings from both Europe and the UK have fueled speculation that the European Central Bank and the Bank of England may adopt more aggressive easing measures. Additionally, anticipation of a 25 basis point rate cut by the Federal Reserve in November has been a key driver for the rise in gold prices. As a result, demand for the non-yielding asset has increased significantly.
Silver also gained support, benefiting from falling US Treasury yields, which enhanced its appeal among investors. As major central banks are widely expected to implement rate cuts, the outlook for silver remains positive.
Commodities
In the oil market, WTI crude prices saw a dip, trading around $70.70 in early Asian trading. The easing concerns about a potential oil supply disruption in the Middle East, coupled with a sluggish outlook for global demand, put downward pressure on WTI prices.
Looking ahead, attention will turn to the release of US retail sales data for September, which is forecast to grow by 0.3% month-on-month, compared to a modest 0.1% rise in August. Additionally, industrial production figures will also be closely monitored. The recent surge in the USD to its highest level since August introduces a note of caution for market participants, as it could weigh on broader market sentiment
