ForexLive Asia-Pacific FX news wrap: AUD jumps after strong jobs report

• Huge improvement in the Australian jobs data may be a ‘head fake’
• Fed faces a tougher battle against inflation than the ECB: US$ to stay stronger than EUR
• Goldman Sachs expect the Bank of Japan to remain on hold at 0.25% at the December meeting
• China to expand its private pension plan nationwide – from Monday December 15
• PBoC-backed media says the Chinese yuan is on solid footing and will stay balanced
• US – China 10-year Treasury yield spread widens to nearly 250 basis points
• Australian jobs data weakens case for Feb 2025 Reserve Bank of Australia interest rate cut
• If China aggressively intervenes in the yuan, it “raises the risk of a tariff cascade”
• RBA Assistant Governor (Economic) Hunter will be speaking on Friday
• PBOC sets USD/ CNY reference rate for today at 7.1854 (vs. estimate at 7.2438)
• AUD/USD back above 0.6400 after the very solid jobs report
• Australia November unemployment rate 3.9% (vs. 4.2% expected)… did a double take on that
• Trump has invited Chinese President Xi Jinping to attend his inauguration next month
• UK monthly house price gauge in November hits its highest level since September 2022
• JP Morgan say ECB to cut by 25bp, but ‘door not shut’ on 50 – Goldman Sachs see 25bp cut
• Ten 2025 crypto forecasts, including Bitcoin to $200,000, Ether to $7,000, Solana to $750
• USD/JPY expected to trade 140 – 150 in 2025 according to most Japanese firms
• In 2024, China saw its first outflow of foreign direct investment in decades
• November’s core CPI gain solidifies expectations for a Federal Reserve rate cut next week
• New Zealand data – November retail sales indicator slumps even lower
• Forexlive Americas FX news wrap 11 Dec: Bank of Canada cuts by 50bps. US CPI as expected.
• Brazil’s central bank hikes rate to 12.25% (from 11.25% and vs. 12% expected)
• Trade ideas thread – Thursday, 12 December, insightful charts, technical analysis, ideas

We had news today that Trump has invited Chinese President Xi to Trump’s inauguration. This softened the USD a touch on the perception that it indicates better relations between the US and China. That’s a long bow to draw on an invitation, but there you go.

From Australia we then had data showing employment rose more than what was forecast in November. Over 35,000 jobs added.
Notably:

• Full-time employment surged by 52,600. Part-time decreased by 17,000.
• The unemployment rate came in under 4% for the first time since
  March, dropping to 3.9%.

The
strong employment data saw
the pricing for
a February
interest
rate cut by the Reserve Bank of Australia (RBA) cut
back, from above 65% prior to the release to under 55% after. The
Australian dollar jumped.

From
China today we had the announcement the country will expand its
private pension plan nationwide. This begins from Monday next week
(December 15). At the margin this should support stocks.

Also,
the People’s Bank of China pushed back on the speculation it’d
allow the yuan to weaken if hefty Trump tariffs were imposed.
PBOC-backed state media said the yuan is on a solid footing.

Earlier,
gold
dipped
in price at the Chinese
cash open.

USD/JPY
dropped back to just under 152.00. Its since bounced but remains in
the lower half of its session range. News and data flow from Japan
was very light.

AUD:

This article was written by Eamonn Sheridan at www.forexlive.com.