AUDUSD Consolidates Gains Above 65 Cents

AUD

The Aussie dollar opens mixed across major currencies while the ASX finished yesterday’s session up 0.3% on the back of 1.5% gains in materials. Asian equities closed slightly in the red yesterday with the Shanghai Comp flat and the Nikkei down -0.1%. Yesterday, we had RBA Governor Bullock speak at the ASIC Annual Forum where she warned wages are growing at a rate that cannot be sustained without a reversal in the nation's productivity slump, hinting at the possibility of another cash rate increase to quash inflation. We also saw the RBA's Monetary Policy Meeting Minutes which reflected discussion surrounding persistent services inflation. Tonight, Bullock is due to speak on the Aussie economy at the Australian Business Economists Annual Dinner.

USD

AUDUSD still remains near 3-month highs at 0.6557, holding firmly above the 0.65 handle set earlier in the week. Wall Street saw a weaker session yesterday with the Nasdaq down -0.6%, S&P 500 -0.2%, and the Dow Jones down -0.3%. This morning's FOMC Meeting Minutes showed the Fed gave no consideration to potential rate cuts at the most recent meeting, stating policy will need to remain sufficiently 'restrictive' until data shows inflation is on a convincing trek back towards the bank's 2% target. Tonight, we'll see Unemployment Claims and Durable Goods Orders m/m.

EUR

AUDEUR opens in the green today at 0.6009, creeping past the 0.60 handle in the earlier session. A quiet day for the Euro saw the DAX close flat, while the CAC ended the session down -0.2%. This morning we had ECB President Lagarde speak at an event hosted by the German Ministry of Finance, where she mentioned that there needs to be more attentiveness to the different forces affecting inflation: the unwinding of past energy shocks, the strength of monetary policy transmission, the dynamics of wages and the evolution of inflation expectations. Tonight, we have the ECB Financial Stability review which is not expected to have a significant impact on the Euro.

GBP

AUDGBP opens slightly lower this morning at 0.5230 with the FTSE closing yesterday’s session slightly in the red at -0.2%. Yesterday, we had the Public Sector Net Borrowing which came in positive for the pound at 14.0B with forecasts at 16.8B. Later in the night we had the Monetary Policy Report Hearings where Gov Bailey mentioned that they have seen a weakening in demand, but also a weakening on the supply side which saw slight gains for the Pound. Tonight, we have the CBI industrial Order Expectations and the Autumn Forecast Statement. Notably, PM Rishi Sunak recently indicated the government is now able to cut taxes given the pace of price increases has eased.

NZD

AUDNZD opens in the red at 1.0837, pulling away from the 1.088 handle set earlier in the week. Yesterday, we had Credit Card Spending y/y, printing -2.8% from a previous +2.9%. No major data for the Kiwi today with all eyes on Friday’s Retail Sales q/q. Sales are expected to slump -0.8% off the back of a -1.0% decline in the prior quarter.