AUD Consolidates After Recent Gains
AUD
The Aussie Dollar moved mostly sideways over the past 24h, consolidating after recent gains and opening mostly flat despite tensions rising in the Russia/Ukraine war. Asian Equities ended the day mixed, with NIKKEI -0.2%, SHANGHAI COMP 0.7% and ASX -0.6%. Commodities were mixed with Iron Ore 0.3%, Copper -0.1%, Gold -0.1% and Silver -0.5%. Yesterday, China left their 1 Year and 5 Year Loan Prime Rate’s unchanged at 3.1% and 3.6% respectively. The world's second-largest economy is seeing early signs of stabilisation after Beijing unleashed its boldest stimulus measures since the pandemic. That is a welcome sign for the nation just before the return of President-elect Donald Trump, who has threatened to ramp up tariffs on Chinese shipments. Locally, this evening we have the RBA’s Michelle Bullock speaking following on from Tuesday’s RBA Meeting Minutes.
USD
The AUDUSD pair declined a little in yesterday’s session despite a hawkish RBA Minutes as risk sentiment declines due to increasing geopolitical tensions which are strengthening the USD. Wall Street ended the day down, DOW JONES -0.1%, S&P 500 -0.5%, and the NASDAQ -0.8%. The USD is also being buoyed up after US Treasury bond yields recover sharply due to the growing conviction of Trump’s expansionary policies which will boost inflation and limit scope for the Fed to cut rates. Overnight the US had their preliminary Building Permits which came in slightly under expectations. Tonight, we'll see Unemployment Claims figures as well as the Philly Fed Manufacturing Index.
EUR
The AUDEUR opens flat this morning at 0.6164 as ECB officials shift focus to revive economic growth. European equities both closed the day in the red, DAX -0.3% and CAC -0.4%. On Tuesday, ECB policymaker, Fabio Panetta said in a speech “With inflation close to target and domestic demand stagnant, restrictive monetary conditions are no longer necessary.” This could signal that rate cuts are on the horizon which could weaken the EUR. Overnight the Euro had their Negotiated Wage Growth which came in at 5.42% increasing from 3.54%. Looking ahead, tomorrow the Euro has their Consumer Confidence Flash, as well as PMI’s.
GBP
The AUDGBP pair opens flat at 0.5139 despite Britain’s inflation rate coming in slightly higher than expected. Annual CPI came in 0.1% higher than expectations at 2.3%, while Core Inflation came in 0.2% higher than expected at 3.3%. The FTSE closed the day down slightly at -0.2%. Looking ahead, on Friday the UK has their Retail Sales figures as well as Consumer Confidence.
NZD
The AUDNZD opens up higher this morning at 1.1069 as markets are pricing in a 50-basis point cut at the RBNZ’s policy meeting next Wednesday. There are even considerations of a mega 75-bps cut next week. Today, NZ will deliver Credit Card Spending y/y.