AUD Tumbles Despite Risk-On Sentiment as Weak Employment Data Takes Hold
The Australian Dollar (AUD) continues to struggle against its major currency peers on Thursday during the early European trading session, despite a risk-on sentiment in global markets.
A weak employment data release for July, showing that employers laid off 15.8K workers, weighed heavily on the AUD, causing it to fall sharply in the Asian session.
The data also revealed an unemployment rate of 4.5%, exceeding expectations of a steady 4.4% rate.
This unexpected weakness is expected to ease fears of a Reserve Bank of Australia (RBA) interest rate hike, which was previously anticipated due to concerns about upside inflation risks.
RBA Deputy Governor Andrew Hauser had warned of these risks earlier in the week, emphasizing the need for higher interest rates to combat price pressures.