Australian Dollar:
Whilst remaining positive business conditions eased during the month of October with the key measure unwinding much of September’s gains following the change in federal leadership. Keeping in mind there were some positive economic reads yesterday which came in the form of housing finance data, showing there has been a shift in lending away from investors towards owner-occupiers, overall price activity has been limited for the Australian dollar during the first half of this week. Trading between a low of 0.7018 and a high of 0.7064 when valued against its US Counterpart, its likely China will once again take the lead today as investors await the release of Industrial production figures. Opening steady this morning the Australian dollar buys 70.20 US Cents
We expect a range today of 0.6980 – 0.7080
New Zealand Dollar:
In what may prove to have lasting implications for the New Zealand dollar, overseas yesterday figures in China confirmed that consumer inflation had once against waned during the month October, falling to a mere 1.3 percent. Suggesting additional stimulus might be on its way further macro developments today are likely to also be closely monitored as investors await the outcome from the RBNZ’s financial stability report which is being delivered live to the market early this morning. Having once again found support up above the 65 US Cents handle the New Zealand dollar has traded in mere 40 basis points range during the past 24 hours, opening 0.1 percent lower at a rate of 0.6523.
We expect a range today of 0.6490 – 0.6560
Great British Pound:
Following last week’s dramatic sell off which was worth close to 2.5 percent, trading ranges have compressed significantly over the past two sessions. Remaining up above the 1.5100 mark when valued against its US Counterpart for the majority of the past 24 hour window, the Sterling this morning trades a mere 15 points below yesterday’s open at 1.5103. Whilst many investors are still projecting further upside momentum for the Greenback, near-term price activity will be greatly influenced by this evenings wage growth and employment numbers, results amplified by the dovish rhetoric we’ve recently heard from policy makers when referencing weaker price pressures.
We expect a range today of 2.1450 – 2.1580
Majors:
Global stocks were mixed overnight as investors continued to bunker down in line with a potential interest rate hike from the Fed next month. In what’s dominated chatter this week, not only are there concerns over what effect higher rates may have on Wall Street, however broader developments from China have highlighted global growth fears. In figures released yesterday China’s Inflation result of 1.3 percent for October was widely disappointing, comfortably missing the consensus forecast of 1.5 percent. Whilst the POBC has already cut interest rates six times in the past year, lower price pressures do leave the door open for even more adjustments as policy makers battle to fight off deflationary fears in the wake of lower growth targets. Distinct currency moves have been few and far between over the past 24 hours with the Greenback maintaining its lofty height for the time being. Whilst steady against the Yen this morning at 123.234 the dollar is 0.4 percent lower against the Euro at 1.0702.
Data releases
AUD: Westpac Consumer Sentiment
NZD: RBNZ Governor Wheeler Speak, RBNZ Financial Stability Report
JPY: No data today
GBP: Average Earnings Index y/y, Claimant Count Change, Unemployment Rate
EUR: No data today
USD: Bank Holiday
Learn more about Michael Judge