No help from the jobs data: Australian dollar stretches to fresh low

Negative sentiment weighs on AUD/USD

A bit of a divergence is creeping into markets.

AUD/USD is at a fresh session low at 0.7435m, down 45 pips on the session. But Treasury yields have bounced with 10s at 1.330% from a low of 1.310%.

Technically, this is an important short-term support zone with the lows of the week just below.

This is all despite a good Australian employment report earlier today. Jobs at 29.1K were in line with the 30.0K consensus but the unemployment rate fell to 4.9% from 5.5% – below pre-pandemic times. The full-time component of the jobs report was also +51.6K.

Australian unemployment rateThe market instead might be focusing on the rising number of cases in Australia and the fresh lockdown in Victoria. It could be a long wait with vaccination progress slow to come by.

In the bigger picture, the delta variant may be weighing on sentiment.

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