AUDUSD Day’s Range: 0.73306 – 0.73906
AUDUSD was trading at a tight range, drifting lower throughout the day and touching a daily low of 0.73306.
It is a busy week of data in the foreign exchange market. There is a number of central bank rate decision, GDP inflation and employment report scheduled for release. Investors are waiting for the U.S. Federal Reserve monetary policy announcement on Thursday this week even though it is likely that the Fed will remain the FOMC statement unchanged. The higher rate of vaccination encouraged more spending and travelling, however, the spread of the COVID-19 delta variant has caused concerns to the market and increased the risk of slowing down economic activity. The Fed did talk about asset tapering at their last meeting. However, any major announcements are likely to be made at the August Jackson Hole symposium and the details will be released at the September FOMC meeting. Therefore, it is unlikely that there will be a major change in the monetary decision this week and it is unlikely to have a major impact on the FX market.
The market will be also influenced by the investor’s risk appetite. If stocks continue to edge up this week, the USD and JPY will weaken, if the stocks decline sharply then all of the major currencies is likely to depreciate.
Data:
- NZ June Trade Balance : 261Mio v. 297Mio exp.
- EU July German IFO Business Climate : 100.8 v. 102.3 exp.
- US June New Home Sales : 676K v. 800K exp.
What to Know
China stocks in the U.S. suffer the biggest two-day loss since 2008 due to Beijing’s crackdown on its technology and education sector. The Nasdaq Golden Dragon China Index tracks 98 of China’s biggest companies listed in the U.S. has plunged 7% on Monday after the Chinese regulators banned firms that teach school subjects from making a profit, raising capital, or going public. The 15% two-day decline from Friday last week to Monday in Chinese stocks was its biggest since 2008.
Major moves in the market:
- Alphabet, Apple, Facebook, Amazon report earnings this week
- Federal Reserve policy meeting concludes Wednesday
- U.S. GDP data are due Thursday
Stocks
- S&P 500 futures were steady. The S&P 500 rose 0.2%
- Nasdaq 100 futures were little changed. The Nasdaq 100 climbed 0.1%
- Nikkei 225 futures added 0.3%
- Australia’s S&P/ASX 200 futures rose 0.3%
- Hang Seng Index futures were little changed
Currencies
- The Japanese yen was at 110.39 per dollar
- The offshore yuan traded at 6.4832 per dollar
- The Bloomberg Dollar Spot Index fell 0.2%
- The euro was at $1.1803
Bonds
- The yield on 10-year Treasuries advanced one basis points to 1.29%
Commodities
- West Texas Intermediate crude fell 0.2% to $71.91 a barrel
- Gold was at $1,797.58 an ounce
Upcoming data:
- JP BOJ Gov. Kuroda to speak on Tuesday
- US June Durable Goods Orders & Core Durable Goods Orders : 2.1% & 0.8% exp. on Thursday
- AU RBA Deputy Gov. Debelle to speak (10:35pm AEST) on Tuesday
- US July CB Consumer Confidence : 123.9 exp. on Wednesday
- US July Richmond Manufacturing Index : 20 exp. on Wednesday
- AU CPI q/q & Trimmed Mean CPI q/q 0.7% exp. & 0.5. exp. on Wednesday
- CAD CPI m/m 0.4 exp. on Wednesday
- US FOMC statement on Thursday
- US FOMC Press Conferences on Thursday
- US Federal Fund Rate on Thursday
- US Advance GDP q/q 8.5% exp. On Thursday
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