Hawkish Bullock Boosts AUD

AUD

The Aussie Dollar opens higher against major currencies after RBA Govenor Michele Bullock’s hawkish comments yesterday, noting the central bank “Won’t hesitate to raise the Cash Rate if needed” and that they don't see domestic inflation in the 2-3% target band until late 2025. The ASX slid -0.2%, dragged by real estate and materials, while Asian equities ended the day mixed, the Nikkei -0.7%, Hang Seng +0.1% and Shenzhen flat. Commodities had a strong day with Crude Oil +1.1%, Natural Gas +3.9%, Iron Ore +0.5%, Gold +0.3%, Silver +0.2% and Copper +0.8%. Today we have Chinese CPI y/y expected at 0.3% from the previous 0.2% and their PPI y/y expected at -0.9% from the previous -0.8%. Next week we will see the main focus on Australia's Employment Change and Unemployment Rate data announced on Thursday. 
 

USD

AUDUSD opens at 3-week highs of 0.6589 off the back of RBA Governor Bullock's hawkish remarks yesterday, where she noted the central bank 'won't hesitate to raise the Cash Rate if needed'. US Unemployment Claims landed at 233k over the past week, being a little less than expectations. Risk sentiment improved overnight and saw the Nasdaq close +2.8%, S&P 500 +2.4%, and the Dow Jones +1.8%. No US data over the next few days, however, next week will be a busy week for the US with most notably the consumer and producer inflationary figures.
 

EUR

AUDEUR opens higher at 1-week highs of 0.6036, reacting to Governor Bullock’s hawkish comments yesterday. Euro equities ended the day mixed, with the DAX 0.4% and CAC -0.3%. Today we will see inflationary figures from Germany and the Italian Trade Balance. We will see a relatively quiet week next week with low tier data not expected to impact markets significantly. 
 

GBP

AUDGBP opens at 3-week highs of 0.5168, being impacted by the stronger AUD and little data out of Europe yesterday. Equities closed in the red with the FTSE -0.3%. No data from the UK until next week where we will have employment numbers set to release on Tuesday. 
 

NZD

AUDNZD opens stronger at the 1.0970 resistance level, having tested this level a couple of times over the past few days before retreating. The RBNZ Inflation Expectations were released yesterday, showing another decline in consumer expectations. Currently, expectations are 2.03% annually for the next 2 years.