FOREX: AUD Crosses - AUD Pulls Back Heading Into NFP

The US Equity move higher stalled overnight and a poor ISM services report saw it trade heavy for the whole N/Y session. The market is trying to ignore the worries about growth that would make the cuts possible but the ISM services data shows these headwinds are increasing. This morning has seen US futures open a little lower, ESU5 -0.05%, NQU5 -0.25%. The AUD is trading sideways in the crosses as the market awaits a clearer direction from global risk.

• EUR/AUD - Overnight range 1.7838 - 1.7915, Asia is currently trading around 1.7865. The pair found decent demand around the 1.7700 area and bounced nicely from there, negating the potential correction that seemed possible. The direction US stocks ultimately decide on following will have a direct impact on the direction of this pair.
• GBP/AUD - Overnight range 2.0527 - 2.0591, Asia is trading around 2.0530. The pair continues to chop around just above its 2.0450 support area. The pair has found good demand towards the lower end of its 2.0400 - 2.1050 range; and with risk facing increasing headwinds this probably offers a good/risk reward to play from the long side looking for a move back to the 2.07/08 area initially.
• AUD/JPY - Overnight range 95.01 - 95.60, Asia is trading around 95.55. The pair failed on multiple attempts above 97.00 and has moved swiftly back to test its first support toward the 95.00 area. There should be sellers around the 96.00/96.50 area initially, a sustained break below 94.50/95.00 could signal a deeper move lower.
• AUD/NZD -  Overnight range 1.0957 - 1.0978, the cross is dealing in Asia around 1.0955. The Cross continues to trade sideways as the pair tries to build some momentum to move higher.

Fig 1: GBP/AUD spot 120min Chart

Source: MNI - Market News/Bloomberg Finance L.P

The Australian Office of Financial Management (AOFM) will today sell A$900mn of the 4.25% 21 March 2036 bond. The line was last sold on 16 July 2025 for A$800mn. This new line was sold by syndication on 5 February 2025 for A$15.0bn. Bidding at today’s auction is likely to be shaped by several key factors: 

• The outright yield is roughly 20bps lower than the previous auction level and about 30bps below the late February peak.
• However, the 3/10 yield curve is similar to the previous auction level and sits around 30bps flatter than its recent high.
• On the other hand, sentiment toward longer-dated global bonds has improved over the past week.
• This bond is also included in the XM futures basket, which may support demand.
• Overall, firm pricing is still anticipated at today’s auction, given the higher yields and other favourable factors.
• Results are due at 0200 BST / 1100 AEST.

The Australian Office of Financial Management (AOFM) will today sell A$900mn of the 4.25% 21 March 2036 bond. The line was last sold on 16 July 2025 for A$800mn. The sale drew an average yield of 4.4476%, a high yield of 4.4500% and was covered 4.0000x. This new line was sold by syndication on 5 February 2025 for A$15.0bn.

• This week's ACGB supply is at the top end of the recent average weekly issuance of $1500-2200mn, with  A$300mn of the 4.25% 21 June 2034 bond issued on Tuesday and A$1000mn of the  3.00% 21 November 2033 bond due on Friday.
• During the first half of 2025-26, the AOFM plans to: issue a new October 2036 Treasury Bond (by syndication and subject to market conditions); conduct 2 Treasury Bond tenders most weeks; hold 1-2 Treasury Indexed Bond tenders each month.
• Issuance of Treasury Bonds (including Green Treasury Bonds) in 2025-26 is expected to be around $150 billion. Issuance of Treasury Indexed Bonds in 2025-26 is expected to be between $2 billion and $3 billion. 
• Results are due at 0200 BST / 1100 AEST.