Australia’s ANZ–Indeed Job Ads increased by 2.0% in July, reflecting widespread robustness across various states and sectors. The TD-MI Inflation Gauge experienced a notable increase of 1.0% in July, representing its first rise since April. RBA Governor Bullock cautioned that elevated underlying inflation may increase further, postponing any potential policy easing. AUD/USD experiences an uptick following two consecutive days of declines, currently trading near 0.7010 during the Asian session on Tuesday. The Australian Dollar gained ground following the release of positive employment data, which showed that ANZ–Indeed Job Ads increased by 2.0% month-over-month in July. This rebound reversed a 0.2% decline from the previous month, marking the fourth monthly rise of the year.
Catherine Birch notes that the growth was broad-based across both states and industries, indicating strong labour demand despite the overall economic cooling. Meanwhile, renewed inflationary pressures are bolstering expectations for a prudent approach by the central bank. Data released on Monday indicated that the TD-MI Inflation Gauge increased by 1.0% month-on-month in July, rebounding from a 0.4% decline in June and representing its first increase since April. This uptick aligns with the Reserve Bank of Australia’s June Meeting Minutes, which projected that underlying price pressures would intensify mid-year.
RBA Governor Michele Bullock recently emphasised that underlying inflation remains too high and warned of potential further increases driven by higher oil prices stemming from the conflict in Iran, strengthening the case for the RBA to hold off on policy easing. BNY’s Geoff Yu notes that RBA Assistant Governor Sarah Hunter acknowledged that “inflation remains above the 2-3% target band” and stressed the central bank must “keep pressure on price growth so higher inflation expectations do not become entrenched.” On the labour market, Hunter judged that conditions are “still somewhat tight,” with job growth having held up “not too badly” over the first half of the year, underscoring ongoing resilience in employment despite softer headline price dynamics.
The AUD/USD pair gains ground as the US Dollar struggles on easing geopolitical tensions amid lingering hopes for a diplomatic breakthrough between the United States and Iran. US President Donald Trump declared that his most recent proposal for negotiations represents a “last chance” for Iran, subsequent to his choice to abort a significant military strike against the Islamic Republic. Trump expressed expectations that negotiations would commence soon to reopen the Strait of Hormuz and tackle US concerns related to Iran’s nuclear program.