Australian Dollar:
The Australian dollar has been well supported over the past 24 hours initially bolstered by a domestic labour market report which showed the Australian economy added 17 400 new Jobs during August a result sufficient enough to see the official unemployment rate remain steady at 6.2 percent. With a CPI print from China also matching consensus forecast, hopes have since been lifted that RBA Governor Glenn Stevens will endorse a wait-and-see approach to monetary settings, ahead of further easing as a steady labour market along with a lower currency ease concerns which surround an economic slowdown. Touching fresh monthly highs, the Australian dollars streak overnight concedes with a one week low for the world’s reserve currency. Stronger this morning the Australian dollar currently buys 70.71 US Cents
We expect a range today of 0.7020 – 0.7120
New Zealand Dollar:
The New Zealand dollar has consolidated its losses from early morning trade yesterday following the Reserve’s Bank decision to cut the official cash rate by 25 basis points to 2.75 percent, hinting also that further cuts may also be on their way. Having now cut three times this year, eliminating three of last year’s four hikes the Kiwi has experienced choppy trading conditions over the past 24 hours with concerns over China, a lower Greenback mixed with ongoing Fed speculation all playing their part. Having touched an overnight low of 0.6255 when valued against its US Counterpart, the Kiwi opens this morning at a similar level to where we left it, lower at a rate of 0.6288.
We expect a range today of 0.6240 – 0.6320
Great British Pound:
The Great British Pound has gathered traction overnight after the Bank of England voted (8-1) in favour of keeping the current monetary stance in place. Stating that the economic outlook remains healthy, offshore turmoil hasn’t changed the views of policy makers who have maintained their broader signals which suggest the focus on higher rates will sharpen during quarter one of 2016. In rhetoric which has favoured a stronger Sterling, the Great British Pound has also benefitted from a weaker Greenback opening stronger at a rate of 1.5458. In other developments the Sterling is stronger against the Kiwi (2.4541) whilst lower against the Aussie (2.1830).
We expect a range today of 2.1760 – 2.1890
Majors:
The US dollar has fallen across the board to a one-week low overnight as speculation mounted that US policy makers would be facing an uphill battle to raise interest rate next week when they meet to discuss monetary settings. Whilst broader and longer-term trends still favour a stronger US dollar, uncertainty and caution have been prevalent overnight, a sign that investors still lack conviction, an understandable position given the US Federal last raised interest rates close to a decade ago. Notably lower against the Asian currencies, the US dollar has also notched up losses versus the Sterling (1.5458) and the Euro (1.1274). With key central bank meetings now behind us this week, investors this evening will be looking towards PPI and consumer sentiment reads from the United States whilst still wary of any abrupt changes to broader risk barometers.
Data releases
AUD: No data today
NZD: No data today
JPY: BSI Manufacturing Index
GBP: MPC Member Forbes Speaks
EUR: ECOFIN Meetings
USD: PPI m/m, Prelim UoM Consumer Sentiment
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