Aussie dollar trades above 67 US cents
Monday 17 April, 2023
Daily Currency UpdateThe Australian dollar is slightly stronger this morning when valued against the Greenback. The Aussie dollar struggled to capitalize on its weekly gains recorded over the past three sessions. On Friday we saw the AUD/USD pair trade just a few pips below its highest level since February 24 touched on Thursday and is currently placed around the 0.6770-0.6775 area nearly unchanged for the day. The AUD fell by “only” 1.2% over the same period to close the week at just over 0.67. NZD/AUD continued to push lower, to just over 0.9250. Apart from the upbeat Australian jobs data on Thursday the revived bets for a 25 bps rate hike at the next Reserve Bank of Australia (RBA) meeting in May supports prospects for the emergence of some dip-buying around the AUD/USD pair.
Looking at the week ahead and there are no scheduled releases. On Tuesday the Reserve Bank of Australia (RBA) will release the Minutes from the last policy meeting. It's a detailed record of the RBA Reserve Bank Board's most recent meeting, providing in-depth insights into the economic conditions that influenced their decision on where to set interest rates. On Thursday we will see the National Australia Bank (NAB) Quarterly Business Confidence survey of about 1,000 businesses which asks respondents to rate the relative level of current business conditions and expectations for the near and medium-term future. On Friday we will see the release of the Purchasing Managers' Index (PMI) a survey of about 400 purchasing managers which asks respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.
Key MoversOn Friday there was a strong market reaction to US data releases, in particular retail sales. The headline figure fell by a greater than expected 1.0% in March adding to the 0.2% fall in February (slightly revised higher). Industrial production was stronger than expected at 0.4% m/m for Mar, but again weather-related effects inflated utilities production, and manufacturing production contracted by 0.5%. Consumer sentiment rose 1½ points to 63.5, stronger than expected and sentiment showed no ill effects from the banking sector turmoil or a bounce-back in gas prices.
In the UK over the weekend the Bank of England is considering raising the amount of savers’ money that is guaranteed if their bank goes bust, after a crisis of confidence that led to the failures of Silicon Valley Bank and Credit Suisse last month. UK banks guarantee up to £85,000 of a saver’s funds in any single account, through a government-sanctioned but bank-funded pool of cash. However, that figure is less than half of the $250,000 (£200,000) that is guaranteed under US rules and is lower than the EU’s guarantee that covers up to € 100,000 worth of deposits. The GBP/USD pair edged lower on Friday but remained close to a 10-month high and had been supported by an improving appetite for risk. GBP/USD ended 0.88% lower and fell from a high of 1.2546 to a low of 1.2398. It will be a big week of British data that could provide clues on the outlook for monetary policy.
- AUD/USD: 0.6600 - 0.6800 ▼
- AUD/EUR: 0.6000 - 0.6200 ▼
- GBP/AUD: 1.8400 - 1.8600 ▲
- AUD/NZD: 1.0700 - 1.0900 ▲
- AUD/CAD: 0.8850 - 0.9050 ▲