AUD Starts the Week on the Front Foot
AUD
The AUD is up across the board, finally garnering some upward momentum with positive data from China yesterday. Chinese New Loans printed yesterday afternoon higher than expected, coming in at 1360B versus the 1275B expectation (Yuan denominated), indicating the willingness of businesses and individuals to take on risk for the future. China’s central bank had a meeting on Monday, saying they would crack down on speculation that distorts the value of the Yuan. This was off the back of the Yuan hitting the lowest level against the US dollar in 16 years last week. The PBoC said that it had organized a “special meeting” to debate "the recent situation in the foreign exchange market and issues around the exchange rate of the renminbi". The news injected some much-needed confidence into what is currently very weak China-related investor confidence, which flowed over positively to AUD. The ASX gained 0.5% in yesterday's session and no movement in AUD linked commodities. Coming up today for Australia is the Westpac Consumer sentiment and NAB business confidence.
USD
The AUD moved up 0.75% against the USD over the course of yesterday, currently sitting at 0.6431, spurred by positive Chinese data (see above). Wall Street traded higher with the NASDAQ gaining 1.1%, the S&P500 0.7%, and the Dow Jones 0.3%. Data from the US is light in the first part of the week, with the first pieces of data printing tonight, NFIB Small Business Index and the 10-7 Bond Auction, but the action really heats up tomorrow night with all-important CPI data from the US.
EUR
He AUDEUR pair moved up to a one-week high of 0.6006 overnight before retreating back down to 0.5979, still up slightly on yesterday's open. This Aussie dollar gain was off the back of better than expected data out of China. Last night, Italian Industrial Production m/m came in worse than expected at -0.7% vs -0.2% expectation. In a more macro-view, Aussie PM Albanese indicated that an Australia-EU trade deal was something he wanted to see come to fruition. 'I would like to see the Australia EU Free Trade Agreement settled as soon as possible,' he told reporters at the G20 Summit in New Delhi on Saturday. The EU is currently Australia’s third largest two-way trading partner, after China and Japan, it is also Australia’s second largest source of foreign investment. Upcoming tonight on the European economic calendar, we have German WPI m/m, German ZEW Economic Sentiment and a few other pieces of small data in the lead up to the ECB’s interest rate announcement at 10:15pm on Thursday night.
GBP
The AUD gained a few points against the Pound overnight, sitting at 0.5134, continuing its week-long upward trend, having fully gained 1.25% since this time last week. No data out for the UK as of yet, but later this afternoon UK unemployment will print, alongside Average Earnings. The Claimant Count change is expected to lessen off the back of last month’s 29K to 17.1K, and the Unemployment Rate is expected to increase slightly from 4.2% to 4.3%.
NZD
The Aussie dollar gained around 0.25% against its antipodean counterpart, currently sitting at 1.0860. Visitor Arrivals printed this morning from across the ditch, coming in at 19.8% increase as tourism season starts. No major movements off this data. Tomorrow the Food Price Index will print, coming in at -0.5% at the previous printing.