The Australian dollar has remained firm today following on from last Friday after the release of the latest job numbers from the US came in well below analysts’ expectations.
At 8pm (GMT) the Aussie dollar was trading at US70.89c up from US70.51c in Friday’s close.
The Non-farm payrolls figure from America come in at 142,000 against analysts’ expectations for a number of 200,000 thousand sending the Aussie dollar on a wild ride before finishing the day strongly.
Unemployment in the US remained at an 8 year low of 5.1%.
The disappointing figures have led some to speculate that the US Federal Reserve will keep rates on hold this year, with the first increase not likely until 2016.
All eyes will now be on the RBA rate decision tomorrow where there is no changes expected with rates remaining on hold at their record low of 2%.
The market will pay close attention to the following monetary statement, with the wording likely to cause a sharp reaction and extreme volatility in the Australian dollar.
The RBA is like to focus on external factors such as the problems in China which is so important to the local economy, and traders may take this as a sign that rate cuts are coming somewhere down the track.
The futures market is pricing in a 50/50 chance of a rate cut early next year.
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