AUD Opens With an Easter Hangover
AUD
The Aussie Dollar continued to slip against most majors into the end of last week and opens generally lower after a weekend of typically lacklustre holiday trading conditions. Asian Equites saw a mixed performance with ASX -0.3%,Shanghai Comp -0.4% and Nikkei +0.4%. Commodities were largely down with Crude Oil -0.1%, Natural Gas -4.1%, Gold -0.8%, Silver flat and Iron Ore -0.6%. On Thursday we saw some mid-tier local data in the form of the Trade Balance which came in above expectations at 13.87B, as well as some mid-tier Chinese data with the Caixin Services PMI also beating market expectations coming in at 57.8. There was no data over the long weekend, but the week kicks off today with Westpac Consumer Sentiment and NAB Business Confidence. Out of China today we will see their y/y CPI and PPI figures as well the M2 Money Supply y/y and most importantly their New Loans which is expected to rise from 1810B to 3300B. The two stand out local data pieces to look out for this week are the Employment Change and Unemployment Rate both to be released on Thursday, with the Unemployment Rate expected to worsen to 3.6%.
USD
The AUDUSD pair has seen a considerable drop since Thursday's open, nearing one month lows dropping a cent to 0.6619 before slightly recovering this morning opening at 0.6645. Wall Street delivered mediocre improvements with S&P 500 +0.1%, Dow Jones +0.3% and NASDAQ flat. On Friday night the Non-Farm Employment Change and Unemployment Rate both beat marginally expectations and Average Hourly Earnings m/m come in flat at 0.3%. Today we have some mid-tier data in the form of NFIB Small Business Index and FOMC Member Williams Speaks. Big data pieces of US data to come this week, the most important of which are CPI figures coming out tomorrow night which are expected to show a significant reduction in yearly inflation, down from 6.0% to 5.2%. Unemployment Claims and PPI figures on Thursday and Retail Sales on Friday.
EUR
The AUDEUR saw a steep drop on Thursday loosing over 60 basis points to hit 7-month lows of 0.6100, before slightly retracing and staying flat for the rest of the session, opening this morning at 0.6116. Euro Equites seemed unaffected by this, both DAX and CAC in the green 0.5% and 0.1% respectively. Thursday and Friday were relatively quiet with only the release of French 10-y Bond Auction and French Trade Balance. This was followed by bank holidays across Europe with banks reopening today to see the release of Sentix Investor Confidence and Retail Sales m/m. Looking at the week ahead, nothing jaw-dropping, mostly mid-tier data highlighted by the ongoing G20 Meetings.
GBP
AUDGBP saw close to a 40bps drop on Thursday before making a slight recovery and flattening out for the remainder of the session, opening this morning at 0.5364. The FTSE was in the green closing up 1%. On Thursday we saw Halifax HPI m/m beat expectation of -0.5% at +0.8%, we also saw the Construction PMI and Housing Equity Withdrawal q/q both miss. Both Friday and Monday saw bank holidays in the UK opening up with BRC Retail Sales Monitor y/y coming in flat this morning at 5.1%. To keep an eye out for this week we will see BOE Gov Bailey Speaking tomorrow and GDP m/m on Thursday.
NZD
AUDNZD opens slightly down at 1.0675 in the wake of a quiet week on the data front. On Friday, we’ll see the BusinessNZ Manufacturing Index posted with expectations of a furthered expansionary trend (last month’s figure was 52.0). Focus remains on last week’s RBNZ interest rate hike, where the central bank surprised markets by delivering a 50bps bump, taking the official cash rate to 5.25%. The accompanying statement didn’t hint at the RBNZ’s next move, although Governor Orr indicated that the extent of moderation in domestic demand, core inflation and inflation expectations ‘will determine the direction of future monetary policy’.