USD Slides with Fed's Independence Under Threat

AUD

Relative to Thursday's open, the Aussie Dollar opens mostly lower against the majors. This came after Australia’s Employment Change missed 40k estimates at 32.2k and the Unemployment Rate was steady at 4.1% (4.2% exp.) We did see a slight recovery yesterday as sentiment-driven weakness in the US Dollar continued to support commodity-linked currencies. On Thursday, the ASX climbed +0.8% with energy recovering losses following the overnight move in oil. Yesterday, the ASX 200 was closed for the Easter Monday Public Holiday, Asian equities were mixed, Japan’s Nikkei -1.3%, while China’s Shenzhen ended +1.6%. Yesterday, China expectedly kept key lending rates unchanged (1-y 3.1%, 5-y 3.6%) as strong macro data allowed its central bank room to focus on stabilising the Yuan amid trade tensions with the US. A relatively quiet week ahead in terms of data. Tomorrow morning, we'll see Australian Flash Manufacturing and Services PMIs.
 

USD

AUDUSD touched 4-month highs of 0.6436 yesterday evening, kicking off today at 0.6421 as the USD tumbles with the Federal Reserve's independence under threat from Trump. The White House has advised that the President and his team were continuing to study whether they could fire Fed Chair Jerome Powell, just a day after Trump said Powel's termination 'cannot come fast enough' as he called for the Fed to cut rates. Investor confidence in the US took a hit. Tonight, we'll see the Richmond Manufacturing Index and various FOMC Members speaking. Tomorrow night will bring Flash PMIs as well as FOMC Member Waller speaking.
 

EUR

AUDEUR opens lower at 0.5578 as investors continue to buy up the Euro in place of the USD. On Thursday evening, the European Central Bank lowered the Main Refinancing Rate by 25bps to 2.4%, as widely expected. At the Press Conference, ECB President Lagarde showed an increased sense of urgency to cut rates further in light of ongoing trade tensions and increased deflationary pressures in the Eurozone. Overnight, Lagarde is expected to participate in an interview conducted by CNBC. Tomorrow afternoon will bring Flash Manufacturing and Services PMIs for the Eurozone.
 

GBP

AUDGBP opens at 0.4799, having moved steadily lower since Thursday's open. There's no meaningful UK data over the next 24h. Tomorrow afternoon, we'll see Flash PMIs.
 

NZD

AUDNZD touched 13-mon lows of 1.0672 this morning before climbing a tad to open at 1.0700. This morning, the NZ Trade Balance came in at 970M (far above expectations of 80M). There's no other major Kiwi data this week.