Commodity Currencies Rally as Carry Trades Resume Their Rise

The Australian, New Zealand and Canadian dollars were all up strongly today. With no Australian and New Zealand data released the rally has been predominately driven by demand for carry trades NZD/JPY is up a whopping 1.38 percent while AUD/JPY is up 1.12 percent.

Even CAD/JPY managed to reverse earlier losses despite a much weaker Canadian employment figure. The market was originally looking for 19k jobs to be added to the economy in the month of April, but instead, the country shed 5.2k jobs. It is about time that we see the strength of the Canadian dollar have a detrimental impact on the economy. Meanwhile in the week ahead, New Zealand and Canada are both releasing retail sales and inflation data. Australia on the other hand only has housing finance and wage costs due for release.