Currency Update - Friday 7th June 20019
AUD
The AUD levitates at 0.6979 this morning, the USD is marginally weaker, the Euro stronger after Draghi was less dovish than expected overnight. Commodities remain elevated, gold trading at a high of $1335 an ouce, whilst oil remain under pressure. Risk was bid overnight, ASX futures opening at 6409. Today's April Home Loan numbers released at 11:30am will shape near-term direction for the AUD, China releases its' Foreign Reserve figures for May around lunchtime also. Trade War headlines were limited overnight, risk marginally on but the AUD finds it tough going above 0.70, after a brief trip above earlier in the week. Focus will be on the USD this evening, with the release of U.S payroll data. Resistance remains at 0.7025, support at 0.6950.
USD
Eurodollar made a move higher overnight as the ECB President was less dovish at their central bank meeting and statement. The USD wobbled as the Fed's Kaplan said that the risk to the U.S outlook had increased. Wall Street opened and closed with modest gains, meanwhile a White House Official said that Mexico wasn't offering enough compromise to avoid tariffs on Monday. Trade Balance and Unemployment Claims data printed as expected. All in all a quieter evening for the big dollar, with Non-Farm Payrolls an important release this evening. Hourly Earnings are expected to have grown by 0.3%, jobs added 180k.
EUR
The Euro sprung into action overnight, rallying over 1.30 against the USD as Draghi provided a less dovish announcement and statement than expected. German Factory Orders grew by 0.3% in April (0.0 exp), EZ Q1 GDP matched expectations at 0.4%. The ECB left interest rates on hold, whilst revising forward guidance outlining that rates would remain at current levels until at least H1 2020. Draghi provided modest revisions to growth and inflation forecasts and discussed the ECB's readiness to act if required. He also stated that low inflation was temporary and would rise later in the year and that the prospects of recession were low, but that the ECB are willing to use QE if required. European stocks closed 0.5% higher, the Euro up across the board. AUD was little effected at 0.6185, off around 0.35%. April IP for Germany and France are released this evening.
GBP
The Pound received a small boost overnight as BOE Governor Carney said rates will need to rise to meet the inflation target. AUD/GBP opens at a familiar 0.5492 this morning, well within its recent range. Meanwhile Barnier said that he will engage with the new U.K P.M, but re-emphasised that the divorce deal cannot be reopened. May resigns today, Boris is a favourite to take over the reigns. Data is thin on the ground for the U.K this evening. NFP's will take centre stage.
NZD
0.6623 is where the NZD/USD opens, up from lows of 0.65 a few weeks back. Trade talks will continue to dominate risk flows, the flightless bird has had a quiet close to the week, reacting to USD moves for the most part.
Today’s data
AUD:
Home Loans
USD:
Non-Farm Payrolls
EUR:
April IP