Aussie range bound as focus shifts to Global Macro
Tuesday 29 October, 2019
Daily Currency UpdateAUD - Australian DollarA drip feed of positive US-China headlines saw equities in the US rally to all time highs as Chinese officials and Trump signalled progress on the "phase one" trade agreement. The Australian dollar remains in a holding pattern but managed to recover it bid tone from last week after initially dropping in Asia’s session to lows around 0.6811. The aussie spiked on the back of the positive mood out of Europe and the US, climbing to a high of 0.6851 (+0.59%), sitting now at 0.6840. Looking forward, it is a busy week starting with RBA Governor Lowe’s speech tonight at a lecture in Canberra. Australian Q3 CPI is released tomorrow in which the consensus is looking for a 0.4% increase to trimmed mean CPI and a 0.5% increase QoQ, while the FOMC meeting on Thursday where the market is already pricing a rate cut, but will put special attention on Jerome Powell’s comments afterwards.
Key MoversTrump stated that he expects to sign China Trade Pact at APEC meeting in Chile next month which takes place Nov. 16-17. This took USDJPY to highs above the 109.00 level for the first time since August. The pair was unable to break the key 200 day moving average level at 109.06, now sitting at 108.95 at the time of writing. The Brexit headlines continued overnight as the EU agrees to delay Brexit until end-of January. GBPUSD hit highs of 1.2877 in the NY session and it has managed to stay around the 1.2860 level despite news that the UK parliament rejected Prime Minister Boris Johnson third call for early election. GBPUSD is still up 0.3%, compared to 1.2820 prior to the vote, although Johnson is expected to propose a new bill for election on December 12th, reiterating that no-deal Brexit is now off the table.
- AUD/USD: 0.6795 - 0.6865 ▲
- AUD/EUR: 0.6130 - 0.6171 ▲
- GBP/AUD: 1.8705 - 1.8865 ▼
- AUD/NZD: 1.0715 - 1.0795 ▲
- AUD/CAD: 0.89 - 0.8960 ▲