AUD/JPY marches beyond 93.00 on upbeat Australia Employment report, inflation expectations

• AUD/JPY takes the bids to refresh intraday high after firmer Aussie data.
• Australia Employment Change rose more than expected in June, Inflation Expectations also increased for July.
• Firmer yields add to the upside momentum but fail to tame recession woes amid inverted curves.
• Japanese firms shows readiness to hike prices amid weaker yen, higher inflation, suggesting more pair for yen.

AUD/JPY takes the bids to refresh intraday high near 93.20 on upbeat Australia employment and inflation data, publishing during Thursday’s Asian session. The pair also takes clues from the firmer US Treasury yields that propel the Japanese yen.

Australia’s Employment Change rose to 88.4K versus 25K expected and 60.6K prior. Further, the Unemployment Rate dropped to 3.5% from 3.9% previous readouts and 3.8% market consensus. Earlier in the day, Australia’s Consumer Inflation Expectations for July came out as 6.3% versus 5.9% expected and 6.7% prior.

Elsewhere, the US 10-year Treasury yields rose four basis points (bps) to 2.95% at the latest while its 2-year counterpart rose 3.5% the previous day, at 3.18% by the press time. It’s worth noting that the yield curve marked heavy inversion with the 10-year mark, which in turn magnified recession woes after the US inflation data rallied to a 40-year high and the Bank of Canada (BOC) announced a 100 bps rate hike.

Amid these plays, S&P 500 Futures drops 0.35% intraday at the latest and probe the AUD/JPY bulls.

Previously, a Reuters survey showed that four out of five large Japanese firms are passing on higher commodity costs to customers or intend to do so.

Moving on, risk catalysts will be crucial for the AUD/JPY traders to watch for fresh directions, especially headlines concerning inflation and recession.

Technical analysis

A clear upside break of a five-week-old descending resistance line, now support around 92.85, directs AUD/JPY prices towards the 21-DMA hurdle surrounding 93.30.