Aussies Eye Out Labour Data

AUD

The Aussie Dollar had a fairly subdued overnight session against the majors, opening either lower or flat this morning. Asian equities closed yesterday mixed with the ASX +0.5%, Shanghai Comp flat and Nikkei +1.2%. Similarly, commodities also closed mixed with Crude Oil -0.6%, Natural Gas +1.8%, Gold Flat, Silver -0.1%, Iron Ore +1.6% and Copper -0.4%. Locally we had a quiet day yesterday, only seeing the release of MI Leading Index m/m which came in above the previous reading of -0.3% at +0.1%. Out of China we saw Foreign Direct Investment ytd/y drop -2.7% from the previous reading of +0.1%. Both data pieces failed to have a lasting effect on the Aussie Dollar. Looking to the day ahead, Australian labour force data for June is expected to show some easing in labour market conditions, with Employment Change data expected to fall from 75.9k to 15.4k, however the Unemployment Rate is expected to remain flat at 3.6%.

USD

The AUDUSD dropped close to half a cent overnight despite poor housing data out of the US, opening this morning at 0.6767. US Housing Starts for June fell by 8.0% to 1.434M with the result mixed against expectations of a 9.3% decline to 1.480M due to negative revisions. Building Permits fell by 3.7% to 1.440M, worse than expectations of 0.2%. US Equities closed mixed with Dow Jones +0.3%, S&P 500 +0.2% and NASDAQ flat. Some important data to keep an eye out for tonight will be released in the form of Unemployment Claims, Philly Fed Manufacturing Index and Existing Home Sales.

EUR

The AUDEUR pair saw 2-month lows of 0.6023 overnight as Euro strength persists, slightly recovering to open this morning at 0.6040. Euro equities closed mixed with the DAX -0.1% and CAC +0.1%. Eurozone’s Final CPI core figures printed above expectations, while headline CPI matched expectations in falling to 5.5% y/y and 0.3% m/m, core data beat 5.4% expectations at 5.5%. A fairly quiet night ahead with German PPI m/m, Eurozone Current Account and EU Economic Forecasts to look forward to.

GBP

Despite briefly touching one-month highs of 0.5260 the AUDGBP opens up relatively flat this morning at 0.5230. British equities gained 1.8% during yesterdays session. Yesterday we saw UK inflation decelerate beyond initial predictions of 8.2% to 7.9%, leading to a significant shift towards a more dovish stance in Bank of England's tightening expectations, resulting in a negative impact on the recently overbought pound. Less importantly we also saw PPI Input and Output, RPI y/y and HPI y/y all fall under expectations. Despite Pound weakness, the AUDD was unable to consolidate any of its initial gains. No British data to be released today.

NZD

The AUDNZD opens lower this morning at 1.0805, seeing a steep drop after yesterday’s inflation data. The CPI q/q results came through above expectations of 0.9% at 1.1% however still lower than last quarter's +1.2%. No more data this week for the Kiwi’s.