- Retail Sales in Australia declined by 0.3% in January.
- US Dollar Index struggles to recover above 97.
- 10-year US Treasury bond yield erases more than 20% ahead of NFP data.
The AUD/USD pair rose to its highest level in two weeks at 0.6658 during the European early trading hours but struggled to push higher as investors seem to be booking their profits ahead of the Nonfarm Payrolls (NFP) data. As of writing, the pair was trading at 0.6630, adding 0.25% on a daily basis.
AUD ignores disappointing sales data
Earlier in the day, the data published by the Australian Bureau of Statistics showed that Retail Sales in January declined by 0.3% on a monthly basis and came in worse than the market expectation for a no-change. However, the broad-based USD weakness didn’t allow the pair to edge lower after this data.
Heightened expectations for another Fed rate cut in March and slumping US Treasury bond yields continue to weigh on the USD. At the moment, the 10-year US Treasury bond yield is erasing 22% on the day and the US Dollar Index is at its lowest level since March 2019 at 95.85.
Previewing the NFP data, “we get the US jobs report for February today. Judging from the latest ADP and ISM signals, we expect to see a decent report with ongoing healthy job creation,” Danske Bank analysts said. The market expectation stands at 175K following January’s reading of 225K.
Technical levels to watch for
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