Australian Dollar:
The Aussie opens marginally weaker against its US counterpart this morning buying only 73.40 US cents. The RBA Board minutes were released yesterday however the dollar remained steady throughout trade as the minutes revisited much of the same ground that was already covered in the previous statement on monetary policy. Key points from the minutes were that they noted unemployment is no longer expected to rise, and tougher measures are expected from the regulator APRA to cool the housing market. Furthermore the minutes predated the recent volatility in the Chinese markets therefore there was no mention of this event. The AUD will once again look overseas for direction this trade session as there are no significant economic data releases scheduled for announcement.
We expect a range today of AUD/USD 0.7310 – 0.7390
New Zealand Dollar:
The NZ Dollar has open a shade higher this morning as dairy prices increased in line with expectations at auction overnight. This increase is also quite notable as this is the first price jump in six months, signalling that perhaps dairy prices have bottomed out and should now be on the rise. The NZD/USD saw intraday lows 0.6556 countered by highs of 0.6604. Upcoming today investors will be keep a close eye on domestic inflationary data being released this morning which should look to influence the local currency, as well as US inflationary data being released overnight. The NZD/USD starts the day at 0.6601
Great British Pound:
Upbeat reports on UK inflation have bolstered the GBP which has rallied across the board overnight. Inflation for July was forecasted to remain at 0%, however a surprise announcement showing an increase of 0.1% has boosted to local currency to reach highs of 1.5709 against its US counterpart. PPI input data and Core CPI figures also came in ahead of estimations which has painted a positive picture for the domestic economy. The pound sterling commences trade stronger against most G10 currencies this morning at 1.5655 against the Greenback, and 2.1328/2.3717 when compared to its Australian/NZ counterpart.
We expect a range today of GBP/AUD 2.1380 – 2.1460
Majors:
The EUR/USD opens weaker this morning due to Greenback strength off the back of US housing data released overnight. Economic reports highlighted that July housing starts had risen to an almost eight year high. Building permits did also detail a reduction for the same month, however as this was off the back of previously strong numbers released in April, May, and June, the soft permits data tended to have a muted effect on the currency pair. The EUR/USD starts lower this morning at 1.1077, and US CPI and Core CPI inflationary numbers being released later in the evening will attract investor attention and look to have a significant impact on the Euro Dollar.
Data releases:
AUD: MI Leading Index m/m
EUR: Current Account
JPY: Trade Balance, All Industries Activity m/m
NZD: PPI Input q/q, PPI Output q/q
USD: CPI m/m, Core CPI m/m, Crude Oil Inventories, FOMC Meeting Minutes