Global Manufacturing Numbers are Weakening
AUD
The Aussie dollar opens this morning lower against the majors following mixed commodity performance, with Gold closing up 0.2%, Silver up 0.9%, Iron Ore down 0.3% and Copper up 0.5%. Asian Equities shared a similar fate, with the ASX closing down 0.2% and the SHANGHAI COMP closing up 0.9%. To yesterday's data, and the MI Inflation Gauge m/m came in unchanged at 0.3%, and Caixin Manufacturing PMI came in marginally higher at 51.8, with expectations of a decrease from 51.7 to 51.5. Today at 11:30am we have Monetary Policy Meeting Minutes set to be released, being unlikely to provide much new information considering there was a Q&A question session with RBA Gov Bullock after the meeting which already revealed the RBA did indeed discuss the merits of an interest rate hike.
USD
The AUDUSD opens lower this morning at 0.6658, with the pair falling during the overnight session. Wallstreet was green into the close, with the DOW JONES up 0.1%, S&P 500 up 0.3% and the NASDAQ up 0.8%. US Manufacturing PMIs released last night printed at 51.6, close to expectations of 51.7, however the ISM version showed a contractionary (sub 50) number of 48.5, missing an expected 49.2. ISM Manufacturing Prices came under at 52.1, taking a solid hit, well down from the expected 55.8. This soft data may give concern to the Fed that the economy may be showing more signs of struggle then expected, pushing the case for cuts in August. Tonight, there is JOLTS Job Openings, expected to lower from 8.06m to 7.96m, and Fed Chair Powell Speaking at an ECB Forum, with any commentary closely watched to see if he hints to future rate decisions.
EUR
The AUDEUR opens this morning lower, with the pair breaking through the 0.62 barrier overnight, and sitting just under until this morning’s open of 0.6198. European equities closed the day up, with the DAX closing up 0.3% and the CAC up 1.1%. Yesterday German Prelim CPI m/m came in unchanged at 0.1%, with expectations of an increase to 0.2%. Tonight, will be a test of the ECB’s policy decision, with their CPI figures set to be released, with the Core CPI Flash Estimate y/y expected to soften to 2.8% from 2.9% and CPI Flash estimate y/y softening from 2.6% to 2.5%. This is the first inflation data since the ECB decided to cut interest rates last month, and should determine whether their cuts where premature.
GBP
The AUDGBP opens the day lower, with the pair slowly sliding over the past 24 hours, opening this morning at 0.5263. The FTSE finished flat yesterday. To the data, and Final Manufacturing PMI came in lower last night at 50.9 although still expansionary, with expectations of it being unchanged at 51.4. Ahead it is a quiet day for the Brits, with all eyes on this Thursday’s Parliamentary Elections, with a rising right-wing faction being the largest cause of economic concern this week ahead. With the BoE writing “It could also increase existing sovereign debt pressures, geopolitical risks, and risks associated with global fragmentation, all of which are relevant to UK financial stability”.
NZD
The AUDNZD continues to push higher yesterday, with the pair rallying to another 2-month high, opening this morning at 1.0967. Earlier this morning NZIER Business Confidence printed lower at -44, previously at -25; and Building Consents m/m came in higher at -1.7%, previously at -2.1%. Looking forward, at 11am today ANZ Commodity prices m/m are set to be released, with no forecasts, but previously at 1.1%.