Aussie dollar trades above US$0.66
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Daily Currency Update
The Australian dollar is slightly stronger this morning when valued against the Greenback, currently trading at 0.6615 at time of writing. On the data front Australian retail sales volumes declined by 0.4% in the March quarter of 2024, continuing a trend of fluctuating performance over recent quarters, figures released by Australian Bureau of Statistics (ABS) have shown. The quarterly decrease follows a 0.4% rise in the December 2023 quarter and a 0.2% fall in the September quarter of the same year. Retail sales volumes fell for the fifth time in the past six quarters as consumers cut back on buying large household items such as furniture and electronic goods. The only rise in volumes over the past 18 months was the December quarter last year as extensive discounting from Black Friday sales boosted volumes. Compared to the March quarter of the previous year, retail volumes have fallen by 1.3%, marking the fourth consecutive year-on-year decline. The ASX 200 Index snapped a five-day winning streak, primarily driven by a decline in heavyweight bank stocks due to regulatory concerns within the sector. The Australian market also reacted to a weak performance on Wall Street, as investors grappled with mixed corporate earnings reports and the Federal Reserve's hawkish stance on maintaining higher rates for an extended period. Looking ahead today and there are no scheduled releases.Key Movers
The US Dollar Index (DXY) is trading at 105.35, slightly down. Despite signals of persistently high inflation acknowledged by Federal Reserve (Fed) Chair Jerome Powell and a recent hawkish stance from the Fed, the US dollar seems to be under mild downward pressure on Thursday due to the report of weak Initial Jobless Claims figures. Initial Jobless Claims data, marking 231K applications, overshooting the 210K forecast, and increased jobless claims underscore anxiety over potential labour market weakness in the US. The upcoming week’s Producer and Consumer inflation data will be crucial, where higher-than-projected figures could minimise rate cut probabilities this year.The Pound sterling erased some of its earlier losses against the US dollar and edged up by 0.03% after the Bank of England’s (BoE) monetary policy decision. The BoE's Monetary Policy Committee voted 7-2 to keep rates at a 16-year high of 5.25%. However, Governor Andrew Bailey said it was possible the central bank would need to cut rates by more than investors currently expect. Money markets are fully pricing in an August rate cut while placing about a 44% chance on a cut in June. Much will depend on upcoming wage settlement and inflation data. The GBP/USD pair is currently trading at 1.2520 at time of writing.
Expected Ranges
- AUD/USD: 0.6500 - 0.6700 ▲
- AUD/EUR: 0.6040 - 0.6240 ▲
- GBP/AUD: 1.8800 - 1.9000 ▼
- AUD/NZD: 1.0850 - 1.1050 ▼
- AUD/CAD: 0.8950 - 0.9150 ▲