Forex Today: Aussie strongest in Asia on RBA, focus on US dollar ahead of US payrolls

A typical pre-US non-farm payrolls (NFP) caution trading prevailed in the Asian session this Friday, leaving the US dollar broadly subdued. As a result, most majors traded on the front foot, except for the Kiwi dollar. Below estimates, China’s services PMI reading weighed down on the sentiment around the NZD. Contrarily, its OZ neighbor, the Aussie rallied hard following the release of the Reserve Bank of Australia’s (RBA) quarterly Statement on Monetary Policy (SoMP).

The yen continued to hold ground against its American counterpart amid extended holidays in Japan while cautious tone on the Asian indices also underpinned the safe-haven bids for the Japanese currency.

On the commodities’ space, gold prices on Comex traded modestly flat around $ 1313 levels, as investors await the US wage growth numbers for fresh hints on the US economic growth and interest rates outlook. Meanwhile, both crude benchmarks remained depressed ahead of the US rigs count data.

Main topics in Asia

Britain unable to leave customs union until 2023 - The Telegraph

Chinese customs expand checks on US fruit imports - Reuters

Iran will not renegotiate nuclear deal - Reuters

NEISR drops UK growth forecast - Telegraph

UK's May avoids wipeout in London elections - Reuters

Japan, China, S.Korea Finance Leaders' meeting: Stressed importance of resisting protectionism

RBA’s SoMP: If the economy improves as expected, higher rates are appropriate

China's Caixin services PMI rises to 52.9 in April, misses estimates

Key Focus ahead

Heading into the final European trading session of this week, markets brace for a light calendar, with no first-tier macro news slated for release from the UK and Euroland. Hence, traders will take cues from the second-liner Euro area final services PMI reports ahead of the Eurozone retail sales release.

The NA session is likely to be a busy one, with the main event risk for today - the US payrolls data due on the cards at 1230 GMT. Markets will keep a close eye on the wage growth figures for further signs of strength in the US growth and inflation. Also, the Canadian Ivey PMI and US rigs count data will be awaited for fresh impetus on the Loonie.

Besides, the speeches by the European Central Bank (ECB) policymaker Weidman and Fed official Dudley will wrap an eventful FOMC/ NFP week.

EUR/USD: US Non-Farm Payrolls to decide how the week ends as Euro struggles to hold 1.20

Friday brings a deceptively packed data docket for the Eurozone, though most of the figures will be inconsequential as markets gear up for another US Non-Farm Payrolls Friday. 

GBP/USD: Bears take a breather ahead of US payrolls

The GBP/USD pair created a doji candle yesterday, signaling the bears are having a breather ahead of the US April payrolls and wage growth release.

NFP Preview: Wage growth in focus as inflation expectations rise

Monthly employment data will take center stage on Friday morning as the US Department of Labor will report on the number of jobs added to the US economy in April, the unemployment rate, and key wage growth figures.