Australian Dollar
Expected Range 0.7140 – 0.7340
The Australian dollar touched fresh 3 month lows through trade on Thursday as investors absorbed a somewhat disappointing labour market report. The Aussie edged lower following softer than expected growth in new jobs while the unemployment rate remained steady at 5.7%. The flat print highlights a slowdown in the wider economy and heightens expectations of additional RBA rate cuts through the end of the year. Swaps data suggest traders are compiling a bearish AUD outlook with investors pricing in further monetary policy easing over the next 12 months. Tapping 0.7180 through early North American trade the AUD rebounded as investors pared USD gains on mixed messages from key FOMC and Fed officials and opens this morning buying 0.7225 U.S cents. Attentions today turn offshore to G7 meetings for direction with the domestic docket proffering little of note.
New Zealand Dollar
Expected Range 0.6710 – 0.6810
The New Zealand dollar offered little to excite investors through trade on Thursday maintaining a relatively tight 50 point trading band in an otherwise volatile trading session. The Kiwi looked off shore with little domestic data on hand to spur direction edging lower following comments from New York Fed President William Dudley. Touching intraday lows at 0.6714 the NZD rebounded as Fed Vice Chair Stanley Fischer counted Dudley’s comments highlighting the disconnect between Fed officials and reiterating market expectations the FOMC is far from unified on calling for a policy amendment come June 14th. Bouncing back through 0.6750 the New Zealand dollar opens this morning marginally lower buying 0.6740 U.S Cents. Attentions today turn to G7 meetings for direction into the weekly close.
Great British Pound
Expected Range 1.9950 – 2.0450
The Great British Pound held on to gains won off the back of recent Brexit polls through trade on Thursday touching intraday highs at 1.4660. Sterling has found strong support this week as two separate polls suggest Britons are leaning toward a “stay” vote, opting to remain within the EU. Perhaps highlighting the importance of political expectations as a directional driver comments from BoE policymaker Gertjan Vlieghe, wherein the MPC member suggested Britain may need to provide more stimulus if growth does not begin to show signs of recovery, were largely ignored and Cable edged only marginally lower into the daily close. Attentions today turn to G7 meetings for direction while Brexit chatter will continue to drive sentiment.
Majors
Expected Range N/A
The U.S Dollar enjoyed mixed fortunes through trade on Thursday advancing against both the Euro and Swiss Franc while paring recent gains and edging lower against the Yen. Investors looked to Fed officials for guidance and direction following Wednesday’s hawkish May meeting accounts only to be disappointed as FOMC members Fischer and Dudley proffered mixed messages when speaking at separate engagements Thursday. New York Fed President Dudley reiterated the disconnect between policymakers and markets, highlighting concerns the market has adopted a pessimistic approach to U.S monetary policy. Analysts pounced on the rhetoric only to pare gains following comments from Stanley Fischer wherein the Fed vice Chair suggested “the United States requires faster potential economic growth in order to lift the long-run equilibrium interest rate”. The Euro having touched seven week lows against the Greenback clawed back through 1.12 and opens this morning at 1.1201. The Yen rallied on risk aversion as weakness in oil prices and U.S stocks following heightened U.S interest rate expectations forced investors to consolidate haven backstops. The Yen advanced through 110 touching intraday highs at 109.72. Attentions today turn to G7 meetings for possible guidance and direction on global monetary policy paths.