AUD Mixed in Subdued Trade
AUD
The Aussie is mixed against the majors, with markets consolidating as we head into a quieter Christmas week. Asian equities closed in the red with the The Shanghai Comp – 1.9%, Nikkei down -1.1% and the Hang Seng -0.5%. ASX finished Monday’s session down 0.2% with Real Estate and Industrial stocks leading the losses. Looking to commodities, Gold was -0.2%, Silver was -0.5%, Iron Ore Flat, and Copper -0.2%. The RBA Board meeting minutes are due this morning and will get some attention for any hints that the Board thinks they are close to at least pausing the rate-hike cycle. The minutes will be important given the post Meeting Statement didn’t explicitly acknowledge the possibility of pausing completely. They only added the caveat that policy was “not on a pre-set course” and that “expects to increase interest rates further over the period ahead “. Fairly quiet for the rest of the week in the economic calendar as we head into Christmas.
USD
The AUD is down slightly against the greenback, after a high of 0.6730 overnight, it opens at 0.6698 this morning. Wall St was lower overnight with the NASDAQ trading -1.7%, the S&P 500 -1.1% and the Dow Jones -0.8% late in the session. US 2-year yields rose 7bps to 4.25% while crude oil gained 1.9% to $75.66 a barrel. Yields on US Treasuries edged higher with the 10-year advancing 5bps to 3.53%. A light start to the week in terms of data, but on Thursday we have the CB Consumer Confidence Index, currently penciled in at 101. Final GDP q/q for the US is also out on Friday, currently predicting 2.9% growth for the period between Oct-Dec, which will be a turn around after the two periods of negative growth the US has had in Q2 & Q3 of this year. Core PCE Price Index m/m is printing early Saturday morning for us, this metric is the US Fed’s preferred method of measuring inflation, a miss or overshot here would be likely to cause movement in markets.
EUR
The Aussie is sitting down against the Euro this morning, opening at 0.6309, after hitting a high of 0.6337 overnight. ECB’s Guindos hit the wires saying ECB action so far hasn’t been sufficient, and the ECB should keep raising rates by 50bp. He added that the ECB will assess QT in June but must be careful. In Germany, IFO December Expectations printed at 83.2 above estimates of 82.0. Business Confidence was 88.6 missing expectations of 87.5. European equities gained in the European session, the DAX was up .4%, and the CAC was up .3%. A fairly quiet week in the European Economic calendar, we have the Current Account for Eurozone being released on Tuesday. Then Consumer Confidence for the Eurozone on Wednesday, currently pricing in a -22, and then the German Buba Bank Monthly Report on Friday. No major market moving data out of the Eurozone this week.
GBP
The Aussie is up against the Pound Sterling this morning, continuing a very slight upward trend across the weekend opening at 0.5503. Monday saw the CBI industrial expectations for the UK come in better than expected at -6, much better than the expected -10 – but still signifying a decrease in volume. A very quiet rest of the week for the UK economic calendar. We have the UK Public Sector Net Borrowing printing on Wednesday, As well as Current Account and Final GDP q/q printing on Thursday.
NZD
The Aussie is up against the Kiwi dollar this morning, seeing a slightly turn around in the recent downward trend, opening up at 1.0530. A few things in the economic calendar for New Zealand this week, today we have the ANZ Business Confidence index, last month’s figure being a -57.1. Later this week on Wednesday we have the NZ Trade Balance, currently pricing in -2062M and also Credit Card Spending y/y printing.