Robust job market assists Dollar climb to decade high

January 30, 2015

The Dollar is heading to its highest level in ten years as recent US jobless claims fell by 43,000 to a near-15-year low at 265,000 in the last week. The data is fairly lower than what economists had expected. Indeed, very strong evidence to show that the US job market is recovering.

Commodity currencies refreshed their lows against the Dollar, as oil prices plunged to new lows of $43.60 per barrel. USDCAD once touched 1.2675 – the highest since April 2009. The CAD slumped right after the exchange level upwardly broke the 1.2580 level, triggering stop orders and pushing the price even higher.

USDCAD 300115 | Vantage FX

The Aussie Dollar hit a new low of 0.7720 this morning as well on heated speculation that the RBA will cut the interest rate next Tuesday. The currency was first dragged by its neighbour NZD as RBNZ stated its currency is still unsustainably high. If the RBA do cut their rate in the upcoming decision, the Aussie Dollar may soon hit the 0.75 level, which was mentioned as a favourable exchange level by RBA Governor Stevens.

AUDUSD 300115 | Vantage FX

Gold fell the most since 2013 as the bright job market data reduced the attraction of safe-haven assets. The bulls in precious metals were betting on the Fed to be more dovish. However, now as the Fed kept its tone yesterday and jobless claims fell again, participants turned into bearish on yellow metal. $1240 will be the support level below.

XAUUSD 300115 | Vantage FX

Back to stock markets, the Shanghai Composite plunged 1.31% to 3262. The Nikkei Stock Average lost 1.06%. Australian ASX 200 rose 0.3% to 5569. In European markets, the UK FTSE was down 0.21%, the German DAX rebounded 0.25% and the French CAC Index fell 0.44%. The US market rose amid corporate earnings. The S&P 500 closed 0.46% higher to 2012. The Dow gained 0.92% to 17349, and the Nasdaq Composite Index rose 0.57% to 4664.

On the data front, Eurozone CPI will be at 21:00 AEDST. U.S. and Canada GDP will be released at 0:30 am AEDST.

Have a great trading day!
Anthony


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