US Inflation Components Remain Hot

AUD

The Aussie Dollar opens slightly lower against majors after another quiet session in terms of local and Chinese data. Zooming out, higher gold prices have helped the AUD push higher over the past month. Asian equites closed yesterday mixed the Shanghai Comp -0.2% and Nikkei +0.3%. The ASX gave up -0.2% after further selloffs in the banking sector. Commodities were also mixed with Crude Oil +1.7%, Natural Gas +4.6%, Gold and Silver +0.1%, Iron Ore -1.5% and Copper -0.3%. No local or Chinese data yesterday, with China’s New Loans and M2 Money Supply y/y still to be released. The next major piece will be China's Industrial Production and Retail Sales on Monday, ahead of the RBA's Cash Rate decision and Press Conference on Tuesday.
 

USD

The AUDUSD pair reached highs of 0.6631 last night before steeply dropping off after the release of their PPI, Retail Sales and Unemployment Claims data, losing the 0.66 handle to open this morning at 0.6580. US PPI data came in stronger than expected with the Core figure notably at +0.3% m/m. Although the figures were largely driven by seasonal increases in gas prices, they add to the recent array of stronger US prints, weakening the case for a near term interest rate cut from the Fed. Unemployment Claims also came in slightly better than expected with forecasts of 218K, reading at 209K. However, US Retail Sales for February printed at +0.6% m/m, up from a negatively revised -1.1%, though below expectations of +0.8%. Wall Street fell in response to the stronger producer inflation data, closing lower with Dow Jones -0.6%, S&P 500 -0.8% and Nasdaq -0.6%. Looking ahead, tonight there are three potential market moving data releases. The Prelim UoM Consumer Sentiment, Prelim UoM Inflation Expectations and US Industrial Production m/m.
 

EUR

The AUDEUR pair saw little movement in yesterday’s session, reaching highs of 0.6058 before opening this morning flat at 0.6045. Equities were mixed with the DAX -0.1% and the CAC +0.3%. No data out yesterday as tonight we await some low tier Italian and French Data in the form of Italian Retail Sales m/m, Italian Trade Balance and French Final CPI m/m.
 

GBP

The AUDGBP looses close to 15 pips compared to yesterdays open, after seeing a steady drop off throughout yesterday’s session, opening this morning at 0.5160. British Equites closed lower last night with the FTSE losing 0.4%. A quiet day in data, only seeing the RICS House Price Balance which came in on expectations of -10% ticking higher from the previous reading of -19%. Tonight we await the release of the Consumer Inflation Expectations.
 

NZD

After hitting lows of 1.0627 the AUDNZD recover some losses but still opens slightly lower this morning at 1.0741. This morning, we saw the release the BusinessNZ Manufacturing Index reading at 49.3 compared to a previous 47.3. Nothing much else happening for the Kiwi’s until next Thursday's GDP q/q release.

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