[MARKET ANALYSIS] DXY flat, Antipodeans lead with AUD outperforming post-jobs

DXY is currently flat and trades within a narrow 98.72 to 98.82 range; the low for the day coincides with its 200 DMA. Some further pressure in the index could see the test of its 100 DMA (98.69).
Focus this morning has been solely on US President Trump, who provided updates on both Greenland and the Fed. Starting with the former, Trump mentioned that he had a very productive meeting with NATO's Rutte, and they have formed a framework for a future deal. Notably, Trump announced that the scheduled tariffs on eight European countries would not go ahead – leading to a familiar “TACO” trade to take place across markets. Elsewhere, on the Fed, Trump said he would like to keep NEC Director Hassett when he is, and now has two or three left in mind for the Chair role. This follows familiar commentary from last Friday, which spurred some strength in the Dollar as markets come to terms with a potentially less dovish appointment; Polymarket odds show Warsh (44%) as the favourite, Rieder (31%) and then Waller (14%).
G10s are broadly firmer against the Dollar; Antipodeans lead with clear outperformance in the AUD after a hotter-than-expected jobs report. In brief, the unemployment rate ticked down to 4.1% (exp. 4.4%), whilst the Employment Change topped expectations. Following the data, analysts at ANZ write that “the decline in the unemployment rate does make a February rate hike more likely at the margin”. As it stands, the odds of a hike at the February meeting jumped to approx. 60% vs 30% pre-release.
JPY is the G10 underperformer this morning, and trades within a 158.17 to 158.89 range; high for the day marks a WTD peak, though still shy of its YTD high at 159.45. Overnight pressure in the JPY was attributed to December exports/trade balance missing expectations. Since, the JPY was mildly strengthened on reports that Japan now forecasts the primary balance to be in a deficit (prev. forecast surplus) in FY26. At face value, a negative, but perhaps given the relatively small deficit amount, eases recent fiscal-related fears.
Finally, Norges Bank kept rates steady at its January meeting and largely reiterated the commentary/guidance from the December confab. As such, there was little reaction in EUR/NOK.