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AUD/USD continues to bump around lows since 2009. The rebound in Australia’s unemployment rate has not reversed the pace for a decline in the pair, economists at Westpac Institutional Bank report. 

Key quotes

“The rebound in Australia’s unemployment rate to 5.3% in January adds to the case for AUD/USD rallies to be very fragile.” 

“Price action remains orderly, but the pace of AUD/USD decline has picked up. The RBA’s clear message that rate cuts are unlikely near term helped A$ crosses in the first half of February, but AUD has underperformed over the past week.” 

“Market pricing for another rate cut remains <50% by May but if the incoming data from across Asia continues to reveal deepening economic damage, the drumbeat for easing should pick up.” 

“Real money A$ shorts on CME are already large, so a dramatic fall seems unlikely, but some trade with a 0.65 handle looks to be in sight near term.”