RBA Warns Rates to Remain Steady

AUD

The Aussie opens up mostly flat against the majors in what was a largely non-eventful overnight overnight session. RBA Governor Michelle Bullock spoke last night, emphasising patience with remaining at current policy settings, noting that “underlying inflation is still too high to be considering lowering the cash rate target in the near term”. The Governor also made a point of the fact that the latest inflation forecasts, which were for inflation "to return sustainably to the 2.5 per cent ... by late 2026" were conditioned on the assumption of market expectations for the cash rate, which at the time were for the "cash rate to remain at its current level over the near term". Asian equities finished the session mixed, Nikkei gaining +0.6%, while the Shenzhen and Hang Seng lost -0.9% and -1.2%. Locally, the ASX closed +0.5%. Commodities closed mostly flat with the biggest mover being Natural Gas at -1.4%. The only local data due today is low-tier Private Sector Credit m/m,  however of more importance will be the China Manufacturing PMI over the weekend.

USD

AUDUSD opens flat at 0.6498 this morning, having struggled to convincingly overcome the 0.65 handle for a few days now. In US data, Core PCE Price Index m/m come out unchanged last night at 0.3% and in-line with market expectations. Other noteworthy data was Pending Home Sales m/m, which showed home sales increased to the highest level since March (+2%). With little new to take away from the data releases, it was a very slow session overnight with both the U.S. equity and bond markets closed for the Thanksgiving Day holiday. There is no more data out for the rest of the week as the Thanksgiving festivities kick off.

EUR

AUDEUR opens flat this morning at 0.6157 after hitting highs of 0.6171 overnight. German Inflation unexpectedly held steady in November (-0.2%) backing arguments for the ECB to continue lowering interest rates, markets are currently expecting a 50 basis point cut at their last meeting for the year next month. Spanish Flash CPI y/y come in higher than expected at 2.4% from 2.3%. European stocks pushed higher to finish the session, DAX +0.9%, CAC +0.5%. Tonight key data is due with Core CPI Flash Estimate y/y and CPI Flash Estimate y/y, data central to the ECB's interest rate path.

GBP

AUDGBP opens flat this morning at 0.5122 after hitting highs of 0.5138 overnight. It was a quiet night last night with no data out for the Brits. Equities were also quiet with the FTSE closing flat at 8281. Tonight, out of London will see a bit of data out with Mortgage Approvals (forecasted to stay flat), followed by BOE Financial Stability Report. Finally the main event for the week with BOE Governor Andrew Bailey speaking with markets keen for clues as to the pace of expected interest rate cuts in the UK.

NZD

AUDNZD opens flat at 1.1038 in what has been lethargic trade. Late morning yesterday saw their ANZ Business Confidence ease by 1 point to 64.9, showing business outlook is brightening. The RBNZ's jumbo rate cut earlier in the week will no doubt feed more confidence into the business sector.