Antipodeans Move Marginally Higher
AUD
The Aussie Dollar gained some momentum overnight, opening higher across the board given improved risk sentiment and positive commodity performance yesterday. Asian equities closed Tuesday mixed as the Shenzhen and Hang Seng pushed 0.6% and 0.1% while the Nikkei shed -1.4%. The ASX dropped -1.7% with no sectors in the green, while commodities were the complete opposite with nothing closing in the red with precious metals Gold and Silver flat, while Iron Ore +1.0%, and Copper +0.7%. Another quiet day domestically with nothing set for release however we might see some news out of China with their Foreign Direct Investment ytd/y set as tentative. Our main release this week will be our Flash Manufacturing and Services PMI’s set for release tomorrow morning at 9am. Overall, a relatively quiet week for the AUD in terms of data.
USD
The AUDUSD moves a smidge higher overnight opening at 0.6682 after Fifth District manufacturing activity remained slow in October, according to the most recent survey from the Federal Reserve Bank of Richmond. The composite manufacturing index increased from -21 in September to -14 in October, outperforming forecasts of -19. FOMC Member Harker also spoke at the Philadelphia Fed’s Fintech Conference, however, refrained from commenting on monetary policy. Wall Street was quiet on the close with the Dow Jones +0.1%, S&P 500 flat, and the Nasdaq +0.3%. Looking ahead today no news in the U.S., however tomorrow the Federal Reserve Beige Book release will offer a qualitative overview of the economic conditions and could potentially impact the communication at the November meeting and interest rate decision. We will also see Existing Home Sales overnight which is forecast to increase from 3.86M to 3.88M.
EUR
AUDEUR opens slightly higher this morning after European Central Bank policymakers, including President Christine Lagarde, said Eurozone inflation may fall quicker than previously thought, supporting the case for further rate cuts. ECB policymaker Mario Centeno called for a “gradual, steady and predictable reduction in interest rates" to their neutral level, which he said was "maybe 2% or slightly lower". Eurozone equities closed yesterday mixed with the DAX -0.2%, and the CAC flat. Another quiet day out of the Eurozone with nothing set for release, however, overnight ECB President Lagarde will once again speak in the G20 Finance Ministers and Central Bank Governors’ meeting in Washington, D.C., USA. Tomorrow evening, we will also be getting the Eurozone Flash Manufacturing and Services PMI’s all set to slightly increase.
GBP
The AUDGBP had an early rally this morning before retracing, still opening higher at 0.5152 after the Bank of England's Green spoke stating “I think it's most likely that monetary policy must continue to bear down to bring inflation to target”. BOE’s Governor Andrew Bailey also spoke, although he abstained from mentioning monetary policy. UK equities saw the FTSE close in the red -0.1%. No further news set for release today. Tomorrow will be a busy day for UK news releases starting with MPC Member Breeden Speaking, followed by BOE Gov Bailey Speaking, then the main events being the Flash Manufacturing and Services PMI release at 7:30pm.
NZD
The AUDNZD opens a touch higher this morning at 1.1057. No news set for release today from our Kiwi neighbours. Early tomorrow morning RBNZ Gov Orr will be speaking about monetary policy at the Peterson Institute in Washington DC.