Sentiment Improves as US Inflation Softens

AUD

The Aussie opens up stronger against the majors this morning. This comes with an improvement in sentiment overnight, partially driven by lower-than-expected inflation in the US. Asian equities closed lower again on Wednesday. The Hang Seng down -0.8%, the Shenzhen -0.4% and the Nikkei up slightly, +0.1%. The ASX dropped -1.3%. Commodities closed in the green baring Natural Gas that close -1.1%. Gold and Silver +0.6% and +0.9%, the biggest mover was Oil (+2.1%). It was a quiet day yesterday out of China and locally with no economic data. Today out of China may have New Loans and M2 Money Supply y/y. Out locally we have our MI Inflations Expectations.
 

USD

AUDUSD opens stronger this morning at 0.6324 with a miss in their inflation data overnight. The softer inflation report saw Wall St. rebound with the Nasdaq trading +1.3% and the S&P 500 +0.6%. CPI was 0.2% month-on-month for both headline and core versus consensus predictions of 0.3%. This pulls the annual rate of headline inflation down to 2.8% from 3%, while core inflation dips to 3.1% from 3.3%, increasing market bets on more interest rate cuts from the Federal Reserve this year. US PPI for February is scheduled for release tonight. As an early indicator of inflation, the components that contribute to the core PCE will be closely monitored. Consensus forecast predicts the final demand to increase by 0.2% m/m, with the core measure expected to rise by 0.3% m/m.
 

EUR

AUDEUR opens stronger this morning at 0.5808 with a slight rebound overnight. Key European markets closed higher with the CAC up more than 0.5% at the closing bell while the DAX was more than 1.5% higher on the day. Tonight is a bit quiet in terms of data with Italian Quarterly Unemployment rate with that looking at a bit of an uptick at 6.2%. We'll also see Eurozone Industrial Production data.
 

GBP

AUDGBP opens up slightly stronger at 0.4877 with an improvement in risk sentiment overnight. Yesterday saw GB Leading Index m/m come at -0.3%. Equities, FTSE finished in the green at 0.5%. This morning we'll see the RICS House Price Balance this is expected to come in at 20% form previous 22%.  All eyes will be on tomorrow night’s GDP m/m. That is forecasted to come in at 0.1% from previous 0.4%.
 

NZD

AUDNZD opens us flat this morning at 1.1028. It was a very quiet day yesterday with no data out. This morning saw Visitor Arrivals m/m come out at 1.9%. Overseas visitor arrivals were 370,200 in January 2025, an increase of 43,800 from January 2024. Tomorrow will see BusinessNZ Manufacturing Index and FPI m/m.