Aussie And Kiwi Dollars Slump Amid Strong US Data
The Australian and New Zealand dollars experienced significant declines to multi-week lows due to firm US data and rising global bond yields. The US dollar, boosted by strong economic numbers, continued its upward trend, pushing long-term yields back towards 15-year highs.
In Australia, the Aussie dollar fell to approximately $0.7025 despite a jump in employment rates in August. However, investors focused on the rising unemployment rate reaching a five-year high of 4.6%, as more people entered the workforce, which could ease wage pressure over time.
The stronger US numbers and higher global bond yields tightened financial conditions worldwide, supporting the greenback and weighing down on 'risk' currencies like the Aussie and Kiwi. This dynamic can dominate even when traders expect local central banks to stay tough on inflation.