Australian Dollar
Expected Range 0.7580– 0.7750
The Australian dollar relinquished recent gains suffering a steady sell off throughout trade on Wednesday. The AUD met strong resistance on moves approaching 0.77 in early trade and was forced lower as investors positioned themselves ahead of what was expected to be an upbeat and hawkish FOMC meeting minutes. With little domestic data on hand to drive direction the Aussie slipped to touch intraday lows at 0.7613, its lowest level in 2 weeks before holding a tight 20 point range into the release of the Fed’s July meeting accounts. The disappointing FOMC and Fed record saw investors again push back expectations surrounding a U.S interest rate increase and the AUD bounced back through 0.7650. At time of writing the AUD buys 0.7652 U.S cents as attentions turn to unemployment data for direction through trade on Thursday.
New Zealand Dollar
Expected Range 0.7180 – 0.7320
The New Zealand dollar rallied early through trade on Wednesday buoyed by stronger than expected labour market data. Declining unemployment and an increase in the number of jobs added to the economy throughout July pushed the kiwi through 0.73 to touch intraday highs at 0.7320. The NZD then suffered a steady sell off as investors, buoyed by upbeat commentary from Fed officials, positioned themselves for a hawkish FOMC meeting minutes. Forcing the Kiwi to session lows at 0.7208 the dairy driven unit then jumped higher after the Fed failed to deliver, proffering an account that again supplied no definitive monetary policy outline. The dollar currently buys 0.7251 at time of writing as attentions today turn to U.S macroeconomic data for direction.
Great British Pound
Expected Range 1.6875 – 1.7175
The Great British Pound edged marginally downward throughout trade on Wednesday touching intraday lows at 1.2992 before profiting on a wide spread USD sell off. Despite a string of upbeat labour market data Sterling struggled to gain any real momentum through domestic trade bobbling along within a relatively tight 50 point trading band. Investors were surprised by an upturn in average earnings and a reduction in the number of those claiming unemployment but failed to respond and carry cable higher. While proffering an upbeat tone there is a sense that the true impact of Brexit is yet to be felt and early data sets could be mere anomalies in a wider and deeper downturn. Sterling did however find support in the FOMC’s meeting minutes and the Fed’s failure to deliver on hawkish expectations. Attentions today turn to domestic retail sales for direction.
Majors
Expected Range N/A
The U.S Dollar enjoyed a mixed session Wednesday advancing throughout Australasian trade before relinquishing gains and settling lower against the Euro and Yen. Buoyed by recent comments from Fed Officials, Dudley and Lockhart, investors anticipated a hawkish Federal Reserve and FOMC meeting minutes carrying the Greenback higher ahead of the release. The minutes however failed to meet market expectations and despite proffering a somewhat upbeat tone a disconnect between members expected timing of additional rate increases and the lack of a clear and definitive path to tighter monetary policy saw traders dump the Dollar. Edging back toward the psychological 100 handle the USD touched intraday lows at 100.06 versus the Yen while the Euro bounced back through 1.1300 to touch session highs at 1.1314. With a slew of upbeat macroeconomic data now needed to persuade the FOMC a rate hike is appropriate investors will be keenly attuned to Thursday’s manufacturing and unemployment claims prints while interpreting comments from New York Fe President William Dudley as he hits the wires addressing the press at a central bank press briefing.