AUD Surges as Weak NFP Report Sparks USD Sell-Off

The Australian Dollar (AUD) surged to near two-month highs against the US Dollar (USD), reaching as high as 0.7070 on Friday, following a dismal Nonfarm Payrolls (NFP) report from the United States.

The NFP data showed a contraction of 23K jobs in July, far below expectations of an 80K increase, leading to a broad sell-off of the USD. The US Dollar Index (DXY) fell, while Gold and Silver prices rose to seven-week highs and solid gains, respectively.

Richmond Fed President Thomas Barkin attributed the weak labor market data to a sector in 'weak balance,' characterizing it as more low-hire, low-fire. He noted that corporate earnings are strong but cautioned that he is watching them for linkages to the job market.