AUD/JPY renews yearly high around 95.50 on upbeat Aussie employment, inflation data, China statistics eyed

• AUD/JPY reverses from the highest levels since November 2022 on mixed Australia jobs report for May.
• Australia Employment Change jumps, Unemployment Rate eases in May.
• Aussie Consumer Inflation Expectations improved for June.
• Yields remain firmer on Fed’s hawkish halt; mixed Japan trade numbers and BoJ’s defense of easy monetary policy favor bulls.

AUD/JPY jumps to the 6.5-month high as Australia’s inflation and employment numbers manage to defend the hawkish bias about the Reserve Bank of Australia (RBA) on early Thursday. In doing so, the cross-currency pair also justifies the upbeat yields and mixed Japan trade numbers.

That said, Australia’s Consumer Inflation Expectations for June rose to 5.2% versus 4.8% expected and 5.0% prior. Further, the Employment Change rallied by 75.9K in May compared to 15K market forecasts and -4.3K previous readings. Additionally, Australia Unemployment Rate drops to 3.6% against expectations of witnessing a no change figures of 3.7%.

On the other hand, Japan’s Merchandise Trade Balance deficit widened in May but Machinery Orders improve for April.

Elsewhere, the US 10-year Treasury bond yield rise 1.0 basis point (bps) to 3.81% while its two-year counterpart grind higher at the three-month top to 4.71% by the press time.

Above all, the monetary policy divergence between the RBA and the Bank of Japan (BoJ), as perceived from the latest comments and actions of the policymakers, keeps the AUD/JPY buyers hopeful.

Having witnessed the initial market reaction to the top-tier Australia data, the AUD/JPY pair traders should pay attention to China’s Retail Sales and Industrial Production for May amid fears of easing economic recovery in Australia’s key customer.

Technical analysis

Overbought RSI (14) line joins double tops marked around 95.75, in July and October of 2022, to challenge AUD/JPY buyers.