Day Ahead: Aussie Wage Data & US CPI

AUD

The Aussie Dollar opens mixed against majors after what was a quiet day in terms of economic data releases. Australia's Federal Budget was released last night, with the government announcing a number of fiscal measures, including promising to spend billions on housing programs as it tries to appease mounting voter angst about a chronic shortage of homes. Commodities performed mixed with Gold +0.1%, Silver +0.5%, Iron Ore -0.6%, and Copper +3.0%.  Asian equities came through mixed with the ASX -0.3%, Nikkei +0.5%, and the Shanghai Comp -0.1%. Later this morning we have our Wage Price Index q/q which is expected at +0.9%, in line with the previous reading. The RBA will keep a keen eye on this figure, as fiscal measures announced overnight, paired with a potential uptick in net wage growth, would result in higher disposable incomes & potential upward pressure on Aussie consumer prices.
 

USD

The AUDUSD opens higher this morning at 0.6625 despite US Producer Price Inflation (PPI) posting the highest print in 12 months. The headline and Core figure were each +0.5% m/m, although Fed Chair Powell seemed largely unphased, noting "I wouldn't call it hot. I would call it sort of mixed". He also suggested US inflation will continue to move lower though recent higher-than-expected readings had reduced his confidence. Wall Street closed in the green with the Dow Jones +0.3%, S&P 500 +0.5%, and the Nasdaq +0.8%. A massive night ahead with the US Consumer Price Index (CPI - the main event for this week), Retail Sales and the Empire State Manufacturing Index. The consensus for CPI is a +0.3% m/m reading, which would reflect a modest slowing in the year-to-date figures. Of course, this US inflation release is expected to shift currency markets if it lands off-expectations.

EUR

The AUDEUR strengthened overnight before falling off after some well performing ZEW Economic Sentiment results came through at 47.1 and 47 respectively. The pair open at 0.6125. Eurozone equities came through mixed with the DAX -0.1%, while the CAC +0.2%. No major news out of the Eurozone today with only the French Final CPI m/m, Flash Employment Change q/q, Flash GDP q/q, and Industrial Production m/m set for release later this evening.
 

GBP

The AUDGBP opens flat this morning at 0.5259 retracing overnight after the UK’s
CB Leading Index m/m came through unchanged at -0.1%. Looking at UK equities, the FTSE closed in the green +0.2%. No major news set for release today, however may get the UK 10-y Bond Auction data as it has been set as tentative.
 

NZD

The AUDNZD coupling opens this morning slightly down at 1.0964. No news set for release today, and will be quiet until this Friday with the release of their PPI Input q/q,
PPI Output q/q.