Currency Markets Quiet with US Public Holiday
AUD
The AUD had a relatively subdued session overnight, trading among the levels seen on Monday. Asian Equities were largely up on the close with the Nikkei 0.7% in the green, while the Shanghai Comp finished up 0.6%. Australian Shares edged higher, bolstered by energy stocks and rising oil prices, the ASX 200 closed 0.3% higher to 7,417 points. There was a mix of Chinese economic releases on Monday with Chinese Retail Sales for December weaker than expected, growing just 1.7% YoY, while the rate of Industrial Production growth for the same month was stronger at 4.0% and China’s Q4 GDP growth came in at expectations at 4.0%. It’s another relatively quiet day locally with traders likely focusing on Thursday’s Australian December Jobs Report.
USD
The AUDUSD is trading at familiar levels seen to Monday, with the pair trading at a rate of 0.7210 at the time of writing. Trading conditions are quiet at the moment given the closure of US markets for Martin Luther King Day. US Equities were mixed on the close with the Nasdaq up 0.6%, the S&P 500 up 0.1% while the Dow Jones dipped lower to -0.6%. Amid a lack of low tier US data, the main focus for traders has been elsewhere with the upcoming Australian Jobs data. The Jobs data will be viewed in context of how it impacts the next RBA meeting in Early February.
EUR
The AUDEUR trades at a handful of pips above Monday’s level’s, with the pair trading at a rate of 0.620 this morning. The week has started slow with US markets shut for Martin Luther King Day, little action across the board with traders looking for inflation-related concerns, yield and equities for directional bias. European Equities closed the day higher with the CAC up 0.8% and the DAX marginally in the green at 0.3%. There is no market-moving data in the Eurozone this week, apart from tomorrow’s ZEW Economic Report and Final EU CPI. Thus, most of the focus will instead be on the minutes of the ECB December meeting, as well as speeches by Lagarde.
GBP
AUDGBP followed suit among the majors to trade at only slightly higher this morning with the pair trading at 0.5278 at the time of writing. It’s been somewhat of a blackout given the lack of higher tier releases and the US Bank Holiday. The FTSE 100 has continued its positive start to the year, pushing close to highs reached pre-pandemic. The Blue-chip index gained 0.9%, passing the 7,600 points level for the first time since January 2020. To the data, the Q4 BOC Business Outlook Survey, taken before the Omicron wave, fell to 3.0 from 9.0 through details were supportive of a rate hike with evidence of labour shortages, increased investment and employment intentions and higher inflation expectations. Looking ahead, the latest UK Labour report is out this evening, followed by the December CPI data on Wednesday.
NZD
The AUDNZD is trading among similar levels seen to Monday, with the pair trading at a rate of 1.06028 this morning. A lack of data has seen an unusually quiet Monday, with trading conditions thinned across the board by US market closures for Martin Luther King Day. Looking ahead, NZD traders now turn their focus on the release of the Quarterly Business Confidence Survey and Australian Labour data on Thursday.