Currency Update - Thursday 23rd May 2019


AUD

A quiet 24 hours sees AUD open today almost unchanged despite local data failing to meet expectations, most notably the decline of 1.9% in Construction Work Done for last quarter which continues the pressure on housing prices and the construction industry in general. Oil fell almost 3% overnight as figures indicated an unxpected increase in US inventories. There's very little on the domestic economic calendar today - and indeed for the rest of the week - with low-impact Flash Manufacturing and Service PMIs due for release later this morning.   

USD

AUD opens at 0.6880 this morning having traded a meagre 22 pip range in the overnight session after the release of the FOMC minutes came and went overnight with little fanfare. There were some dovish tones throughout the statement although none that pointed to an imminent rate cut as we have seen earlier this week from the RBA. On the US/China trade war, Treasury Secretary Mnuchin commented that he expects busines to move away from China due to the tariffs, but that if China wished to reopen negotiations, the US was "open for conversations". Wall street was lower in general to the tune of ~0.5% and there is only low-impact US data due for release tonight. Support for AUD forms at 0.6850 and resistance at 0.6930.

EUR

AUD opens at 0.6167 this morning after a quiet 24 hours in currency markets. No data of note overnight, but potential for movement tonight as the data ramps up in the form of April Manufacturing and Services PMIs for Germany, France and for The Zone as a whole. The March equivalent release showed the Eurozone's manufacturing sector remained in contraction (albeit with a slowing pace of decline) and service sector growth slowed to one of its weakest rates since 2016. Expectations are for a modest improvement in both manufacturing and services with tonight's data. Euro equities finished the day with mixed results,

GBP

AUD opens higher against GBP at 0.5432, having topped out at 0.5449 overnight. The gains a result of worse than expected UK CPI (0.6% actual vs 0.7% expected) and the Core CPI measure also missed the mark (1.8% actual vs 1.9% expected). Adding to GBP weight, numerous headlines hitting the wires about speculation that PM May would be forced to resign in coming days, potentially even by the end of the day if the 1922 Committee was able to change party rules and call an immediate vote of no confidence. We'll keep you posted on development here, with a vote of no confidence expected o weaken GBP further. No GBP related economic data due for release tonight.

NZD

AUD opens this morning at 1.590, continuing a slow grind higher in what has been an evenly-matched contest for the month so far. No NZD data due for release today and with only moderate data due tomorrow (Trade Balance figures), NZD movements are likely to be driven by offshore events and risk sentiment.

Today’s data

AUD:

  • No Data 

USD:

  • No data

EUR:

  • German Flash Manufacturing and Services PMIs, French Flash Manufacturing and Services PMIs, Eurozone Flash Manufacturing and Services PMIs, German Ifo Business Climate, ECB Monetary Policy Meeting Accounts

GBP:

  • No data 

NZD:

  • No Data 

CNY:

  • No data

FX Corp