Currency Update - Tuesday 9th July 2019
AUD
The AUD opens a shade below 0.70 U.S cents this morning, no real movement to talk of in the past 24 hours, markets were generally calm overnight. Monthly Job Ads were up 4.6% yesterday in a more positive sign for the local economy. Iron Ore made ground, other commodities marginally weaker. Business Confidence numbers today will be important for the local unit. Optimism has improved since the ALP re-took office, the result shouldn't shift the AUD around too much however, the recent range expected to remain intact between 0.6950 & 0.7050. Equities lost ground yesterday and overnight, which could hang over the AUD today. Comments from U.S Governor Powell the near-term risk event for markets. Most commentators expect the U.S Federal Reserve to slash interest rates at some point this year, a near-term rate cut is looking less likely however on account of another strong U.S payroll showing over the weekend.
USD
The big dollar edged higher against the majors in overnight trade, the Pound and Euro clinging onto important support at present, the AUD faring better by treading water. U.S stocks opened and closed in the red, a retreat from recent all-time highs. With the increasing prospect of monetary accommodation this could be another opportunity for investors to buy the dip. There was no data to report on and none to speak of this evening. Governor Powell speaks twice this week, which will be important for U.S and global markets alike. We know where Trump stands on looser monetary settings, will Powell accommodate the President or remain in wait and see mode?
EUR
European data beat expectations overnight, German Industrial Production saw a sharp turnaround with May's number increasing by 0.3%, following a fall of 1.9% in April, Trade Balance figures were also impressive at 20.6bn (17 bn exp). The ECB's Coeure waxed dovish saying that QE would be started if needed and that accommodative policy is now needed more than ever. Italy's Retail Sales are released this evening.
GBP
Boris Johnson will embark on a charm offensive with European leaders whilst Parliament is out for its summer break in the hope of breaking the impasse. Is Boris the right man at the right time to lead the U.K out of Europe with a more palatable deal, time will tell. Meanwhile the Pound is close to collapse against the USD and looks set for further weakness against the AUD. GDP numbers released on Wednesday will be important for GBP sentiment, no data released this evening.
NZD
AUD/NZD opens at a familiar level this morning. There's no data to discuss, the NZD comfortable at recent levels across the board.
Today’s data
AUD:
Business Confidence
EUR:
Italian Retail Sales