The AUD/CHF currency pair settled at Friday’s low of 0.5586, its weakest level since April 27th, as Australian labor data reinforced expectations that the Reserve Bank of Australia might delay any additional policy tightening at its upcoming June meeting.
Australia’s unemployment rate has risen to 4.5% in April, marking its highest level since late 2021.
The unexpected increase has shifted market pricing for RBA policy, as investors now see the data as giving the central bank greater justification to pause rather than proceed with a fourth rate hike this year.
Swaps indicated about 12% probability of a rate hike at the RBA’s next meeting in June, signaling that traders are largely discounting further tightening in the near term.
Traders are also watching geopolitical developments in the Middle East, particularly prospects for a US-Iran agreement aimed at ending the ongoing war in the region.
In Switzerland, attention is turning to the policy stance of the Swiss National Bank. Investors are looking for new signals on whether the central bank may move away from its dovish approach as global inflation pressures build, supported in part by elevated oil prices.
Any indication of a shift in the SNB’s monetary policy outlook could affect the Swiss Franc’s trajectory against the Australian Dollar.
The minor Forex pair lost 1.21% for the week.
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