AUD Steady Ahead of Tomorrow's Inflation Data

AUD

The Aussie opens mixed this morning after what was a quiet day in the local calendar. Asian equities followed suit coming in mixed with the Nikkei closing 0.5% higher, the Hang Seng flat and the Shenzhen down -0.5%. Locally, the ASX slid -0.8%, dragged lower by energy and health care. Commodities saw a better performance with Gold and Silver both up 0.1%, Iron Ore +0.6%, while Copper came through -0.2%. Another quiet day for Aussie data releases with only Westpac Consumer Sentiment set for release at 10:30am with no forecast provided. All eyes however will be focused on the CPI y/y results set for release tomorrow at 11:30am which is expected to have risen to 3.8% from 3.6%, a potential increase in inflation which may underscore the central bank's hawkish hold last week and may support the Australia dollar through increased possibility of a rate hike in the future.

USD

The AUDUSD opens higher this morning at 0.6655, readjusting after an early morning peak caused by FOMC Member Daly’s speech stating that the Fed must be mindful of not loosening policy too early or holding too long. Her remarks followed comments last week from several Fed officials who emphasised the need for more evidence of cooling inflation before lowering interest rates. Policymakers have held borrowing costs at a two-decade high for nearly a year now, and they appear in no rush to lower them. Earlier this month Fed officials pencilled in just one rate reduction for 2024, down from the three which were projected back in March. US equities were mixed in the close with the Dow Jones +0.9%. the Nasdaq -.1.1%, and the Dow Jones -.0.7%. Looking ahead we will have a few pieces of US data set for release overnight with S&P/CS Composite-20 HPI y/y which is expected to fall from 7.4% to 7.0%, CB Consumer Confidence set to decrease to 100 from the previous 102, and Richmond Manufacturing Index also set to underperform from the previous 0 to -3.

EUR

AUDEUR opens slightly lower this morning losing its 0.62 handle at 0.6196 despite some weaker German ifo Business Climate overnight, showing pessimistic expectations of Europe’s largest economy. European equities closed in the green with the DAX +0.9%, and the CAC +1.0%. It will be a pretty quiet week for EUR data releases with nothing set for today, and only the German GfK Consumer Climate set for release late afternoon tomorrow, and possibly we may hear from the German Buba President Nagel tomorrow as it is set as tentative.

GBP

AUDGBP opens slightly lower this morning at 0.5242 after late last night’s CBI Industrial Order Expectations release out of the UK came through better than forecast at -18 from the expected -26. UK equities also saw a slight boost closing in the green with the FTSE +0.5%. No further news set for release out of the UK today, however tomorrow night we will see the CBI Realized Sales set to decrease to 1 from the previous 8.

NZD

The AUDNZD coupling opens higher this morning at 1.0871 after a late rally this morning. No data set for release for our Kiwi neighbours today or tomorrow, however we will see ANZ Business Confidence from across the ditch on Thursday.