AUD/USD flows: Dismay employment data and poor regional sentiment drive the Aussie lower early

The Australian Dec labor report has missed estimate badly at -65.1K with expectation of +17.6K and unemployment rate at 3.9%. Participation rate also lowered from 67.2% to 66.8%. The December report more than neutralized November's strength but should not be used to determine a significant weakening in the Australian labors market as one single month is not comprehensive enough. Yet, there is no doubt very unlikely we will see persistent strength in which  as capacity has been long fully utilized. Chinese equities slumped when Chinese Premier Li Qiang signaled Beijing won’t resort to huge stimulus to revive growth amid the worst bout of deflation in decades in the World Economics Forum. 

The perfect storm brought the AUD/USD to 0.6526 earlier before rebounding to trade 0.1% higher at 0.6658 now.