AUD/JPY trapped in a narrow range, eyes Aussie jobs data
- AUD/JPY is stuck in 75.10-76.30 trading range.
- A big beat on Aussie jobs data will likely yield a range breakout.
AUD/JPY is lacking a clear directional bias since July 1.
The currency pair has been largely restricted to a trading range of 75.10-76.30, which could be breached following the release of the Aussie jobs data at 01:30 GMT today.
The data is expected to show Australia's economy added just 10K jobs in June, far less than the 42.3K jobs additions in May. The jobless rate is forecasted to remain unchanged at 5.2%.
A weaker-than-expected jobs data could embolden the Reserve Bank of Australia to cut rates again, possibly in August. It is worth noting that the central bank has already reduced rates in May and June and the market seems priced in for a third rate cut before the year end.
As now, the third rate cut is seen happening in the final quarter of this year. Markets may pull forward expectations of another rate cut to August from November, sending the AUD lower across the board if the labor market data disappoints expectations.
AUD/JPY will likely fall below 75.10, confirming a downside break of its recent trading range.
The Aussie, however, could rise well above 76.30, confirming a range breakout if both the headline and full-time jobs figure better estimate by a big margin. As of writing, the pair is trading at 75.52.