Rapid Increase in Aus Building Approvals

AUD

The AUD opens a little stronger against most majors (flat against the Euro) as global risk sentiment appeared to improve slightly over the past 24 hours. Yesterday, Aussie Building Approvals m/m skyrocketed +10.4% against an expected +2.4% increase, reflecting a potential turnaround in the sluggish building sector off the back of the RBA's interest rate hiking campaign. China's manufacturing output swing back to modest growth in August, with the Caixin Manufacturing PMI printing at 50.4 (exp. 50.0) as export orders offset weakening domestic consumption. Asian equities started the week mostly weaker, the Shenzhen and Hang Seng both -1.7%, while the Nikkei held at +0.1%. The ASX finished +0.2% gains driven by the financials and energy sector. Commodity prices saw a weak finish with Crude Oil 0.7%, Natural Gas -3.3%, Silver 0.1%, Gold and Iron Ore flat. Light on data over the next 24 hours. Tomorrow, we will have key Aussie GDP q/q figures expected to slightly increase to 0.2% from the previous 0.1%.
 

USD

AUDUSD opens higher at 0.6786, having risen from 0.6757 lows yesterday with the US having a quiet trading day due to their Labour Day holiday. Wall Street was closed in observance. Late this evening will bring the ISM Manufacturing PMI, with the ISM Services PMI set for release late Thursday evening. The US economy appears to be softening and both of these reports could produce a similar effect on the market. After this evening, the next major piece will be US JOLTS Job Openings, tomorrow evening.
 

EUR

AUDEUR opens flat at 0.6132 despite data revealing the Eurozone manufacturing sector remains in contraction. Midway through the third quarter, manufacturers in the euro area continued to face significant pressure with factory output declining across most surveyed nations. New order inflows dropped at the fastest rate seen in 2024, prompting manufacturers to further cut back on input purchasing employment, and inventories. In addition, business confidence fell to its lowest level in five months. Euro equities finished the week relatively flat with DAX +0.1% and CAC +0.2%. The only notable releases today are monthly German Retail Sales and the Spanish Unemployment Change.
 

GBP

AUDGBP opens higher at 0.5163 despite the continued recovery in the UK’s manufacturing sector (Final Manufacturing PMI at 26-month high of 52.5). The UK’s manufacturing sector continues to recover into August with the increase of output, new orders and employment. UK equities showed weaker performance with the FTSE closing -0.2%. We will see a quiet day today and tomorrow with no major data sets out however key announcement this week will be on Thursday with the Construction PMI expecting a slight decrease from 55.3 to 54.6.
 

NZD

AUDNZD opens higher at 1.0899 with the NZ Overseas Trade slowing down dramatically. We saw a significant drop of NZ’s international trade prices, increasing +2.1% q/q from the previous +5.1%. Tomorrow we will have GDT Price Index and the ANZ Commodity Prices m/m.