Home Daily Commentaries Markets steady ahead of Thursday’s US Inflation Data

Markets steady ahead of Thursday’s US Inflation Data

Wednesday 13 September, 2017

Daily Currency Update

Key Movers

The Australian dollar held a relatively tight 50-point range through much of Tuesday having found support on moves toward 0.80 U. S cents. With little macroeconomic data to steer direction the Australian Dollar bounced between intraday lows at 0.8001 and session highs at 0.8050 as investors simply squared positions and risk appetite crept back into the market. Despite easing tensions with North Korea and the softening of Hurricane Irma investors were wary of extending USD gains. The bearish channel remains intact and CPI inflation data poses a significant risk to short term positioning. Attentions remain squarely fixed on Thursday Domestic labour market print and U.S inflation read as key markers and possible catalysts driving an immediate directional shift. 
The New Zealand dollar moved higher in the domestic session yesterday, benefitting from the latest opinion polls in the lead up to the general election on September 23rd. Opening at 0.7250 against its American counterpart, the Kiwi drifted off to an intraday low of 0.7220 before surging higher after the Newshub poll suggested an increase in lead for the National Party to 47.3%. The NZD/USD cross hit eventual highs of 0.7320 rallying a full cent. The New Zealand dollar opens at 0.7285 ahead of the latest Food Price Index figures due for release this morning.
The Great British Pound found upside when valued against its US counterpart over the past 24 hours, trading as high as 1.3298 versus the US Dollar a level not witnessed for one year. The main catalyst for the move was a jump in the inflation rate more than markets had forecasted, according to the Office for National Statistics the rate jumped from 2.6% to 2.9% last month which puts pressure on the Bank of England to start tightening their monetary policy rate. The GBP/USD pair may continue to find support with today’s release of UK Average Earnings Index and the Unemployment rate, investors are hoping to see a rise in average earnings in July of 2.3%.

Expected Ranges

  • AUD/USD: 0.8000 - 0.8100 ▲
  • NZD/USD: 0.7250 - 0.7350 ▲
  • GBP/AUD: 1.6500 - 1.6600 ▲