Analyzing the current economic data, it is evident that a steady unemployment rate and a surge in nonfarm payrolls could potentially lead to an increase in wage growth. This upward trend in wages has the potential to boost disposable income, which in turn could fuel consumer spending and drive demand-led inflation.
The Federal Reserve may choose to respond to this situation by delaying rate cuts in order to reduce disposable income and curb excessive consumer spending. The decision-making process of the Fed could have a significant impact on the overall economic landscape.
US Jobs Report Forecast
Economists are forecasting an increase of 200k in nonfarm payrolls for the month of March, following a rise of 275k in February. The unemployment rate in the US is expected to remain at 3.9%, while average hourly earnings are predicted to increase by 4.1% year-on-year, slightly lower than the previous month’s increase of 4.3%.
The current economic environment, especially the US Jobs Report, is likely to influence the exchange rate of the Australian Dollar (AUD) against the US Dollar (USD). Any positive surprises in the labor market data coupled with hawkish commentary from the Fed members could potentially strengthen the US dollar and impact the AUD/USD exchange rate.
Technical Analysis of AUD/USD
From a technical standpoint, the AUD/USD pair is currently trading above the 50-day and 200-day Exponential Moving Averages (EMAs), indicating a bullish sentiment. A potential move towards the $0.66500 handle could be expected if the current trend continues. However, a break below the 200-day EMA and the $0.65760 support level could signal a downward trend, leading to a potential retest of the $0.64582 support level.
The upcoming US Jobs Report and the commentary from FOMC members will play a crucial role in determining the future direction of the AUD/USD exchange rate. Traders and investors should closely monitor the economic data and be prepared to react to any significant developments in the market.