• AUD/JPY holds losses following the release of Australia’s softer employment data.
• Australia’s Unemployment Rate rose to 4.5% in April; meanwhile, the Employment Change dropped by 18.6K jobs.
• Japan’s Trade Balance came in at JPY 301.9 billion surplus in April, beating expected decline of JPY 29.7 billion.

AUD/JPY inches lower after registering over 0.5% gains in the previous day, trading around 113.60 during the Asian hours on Thursday. The currency cross remains subdued following the release of Australia’s labor market data.

Australia’s Unemployment Rate climbed to 4.5% in April, up from 4.3% in March. This figure came in above the market consensus, which had predicted the rate to hold steady at 4.3%. Meanwhile, the Employment Change dropped by 18.6K jobs in April. This decline followed a revised increase of 23.3K jobs in March and fell significantly short of the consensus forecast, which had anticipated a gain of 17.5K jobs.

S&P Global showed that the preliminary reading of Australia's Manufacturing Purchasing Managers’ Index (PMI) declined to 50.3 in May from 51.3 in April. The downturn was even more pronounced in the service sector, where the Services PMI eased to 47.7 in May from 50.7 in April, sliding into contractionary territory. Consequently, the Composite PMI fell to 47.8 in May, down from the previous month's reading of 50.4.

The AUD/JPY cross holds losses as the Japanese Yen (JPY) receives support after the release of Japan’s Merchandise Trade Balance Total, which swung to a surplus of JPY 301.9 billion in April 2026, reversing a deficit of JPY 149.5 billion from the same period last year and significantly outperforming the market's projected JPY 29.7 billion shortfall.

Japan’s Exports surged by 14.8% year-on-year to a near-record JPY 10,507.3 billion, accelerating from an 11.5% increase in March and recording the strongest growth in three months. Over the same period, Imports grew by 9.7% to JPY 10,205.4 billion. While this represents a slight deceleration from the 10.9% gain seen in March, the figure still surpassed market expectations of an 8.3% increase.

Bank of Japan (BoJ) Policy Board Member Junko Koeda said on Thursday that Japan's core inflation rate has approached 2%. Koeda also highlighted progress towards achieving the BoJ's inflation goal, a key focus for policymakers in recent years.