European PMIs Deteriorate Further

AUD

The Aussie Dollar found support amongst the majors to start the week, attempting to take back the weekend’s losses, whilst the Asian equities closed lightly in the red, with both the ASX and the Shanghai Comp down 0.1%. Yesterday the local Manufacturing PMI data actually improved from 48.2 to 49.6, whilst the Services equivalent continued to deteriorate as is the trend for Services globally. No news being released locally today, however, markets are in anticipation for the release of the crucial inflation data being released tomorrow morning, which will play heavily into the RBA's interest rate decision in one week from today.

USD

The AUDUSD opens flat today at 0.6740 after the AUD was supported by the yesterday's comparatively decent Aussie PMI data. Wall St remained in positive territory in the final hour of trade with the Dow Jones and the S&P 500 both up 0.5%, and the Nasdaq up 0.2%. US PMI data was also released yesterday with mixed results; Flash Manufacturing PMI printed 49 last night, beating the forecasted 46.1, however the Services equivalent deteriorated to 52.4, down previous reading of 54.4. Relatively equal sized misses in different directions left the markets with little to reprice. Looking forward tonight we have the CB Consumer Confidence numbers which are surprisingly expected to improve despite cost of living pressures and high interest rates. Tomorrow night's US interest rate decision is looking large with markets all but sure of a further 25 bps rate hike from the Fed.

EUR

The AUDEUR sees strong gains yesterday, seeing a 58 pip gain from bottom to top, opening today at 0.6090. The European Equities had a mixed close yesterday, wit the DAX up 0.1% and the CAC down 0.1%. Looking to the data the Eurozone had a typical data dump yesterday, with 6 different PMI results released last night, all being under expectations, resulting in EUR weakness and opening the door to an AUD advance. The most noteworthy of the poor PMIs, was the German Flash Manufacturing PMI which came in at 38.8, down from a previous 40.6, and the worst result since May 2020. As Europe's biggest economy, this dragged down the results for the EZ as a whole. Littlie in the way of data tonight, except the German ifo Business climate, expected to come in at 88 from a previous 88.5.

GBP

The AUDGBP is also up on yesterday, opening today at 0.5250 after the UK's PMI data performed poorly relative to the Aussie equivalents. The UK equities keep slight gains, with the FTSE closing yesterday up 0.2%. Looking to the data, the UK PMI data followed the European trend of being under expectations, with the both Manufacturing and Services numbers both showing declines on previous results and also being worse than expectations. Little in the way of data tonight, there is CBI Industrial Order Expectations data being released, expected at a dismal -17 from -15 prior.

NZD

The AUDNZD enjoyed a slight uptick in the morning to push the pair through the 1.092 handle, but then fell into today's open of 1.0855. Trade balance data was released early yesterday in NZ and missed expectations considerably, showing a miserly 9mio balance compared to expectations of 235mio. Credit Card Spending y/y however came in ahead of expectations at 5% from a previous 3.4%, although caution should be taken here around the positivity of this number - is an increase of credit card spending a reflection of household budgets being forced to stretch rather than a reflection of consumer confidence?