Data:
Monday
- CNY Retail sales y/y: exp. 3.85
- CNY Fixed Asset Investment ytd/y: exp. 6.3%
- CNY Industrial Production y/y: exp. 3.0%
- CNY Unemployment rate: exp. 4.9%
Tuesday
- USD Empire State Manufacturing Index: exp. 20.4
- AUD Monetary Policy Meeting Minutes
- AUD RBA Gov Lowe Speaks
Wednesday
- USD Core Retail Sales Oct: exp. 1.0%
- USD Retail Sales Oct: exp. 1.2%
- USD Industrial Production Oct: exp. 0.9%
- USD FOMC Members Barkin, Bostic & Daly Speaks
- AUD Wage Price Index Q3: exp. 0.6%
Thursday
- CAD CPI oct: prev. 0.2%
- USD FOMC Member Williams Speaks
- NZD Inflation Expectation Q3: prev. 2.27%
- FOMC Members Bowman, Waller, Daly, Evans & Bostic speak
Friday
- USD Philly Fed Manufacturing Index: exp. 22.3
- USD Unemployment Claims: exp. 260K
- GBP Retail Sales Oct: 0.5%
- EUR ECB President Lagarde Speaks
Saturday
- CAD Core Retail Sales Oct: prev. 2.8%
- CAD Retail Sales Oct: prev. 2.1%
- USD FOMC Member Waller & Clarida Speaks
AUDUSD Day’s range: 0.72777 – 0.73362
China’s data might set the mood for commodity link-currencies including AUD today as the industrial output, retail sales, and fixed asset investment data will be released. We also have the RBA meeting minutes releasing tomorrow, and investors expect them to provide more information around the rate hike timeline following the decision to drop the three-year yield target. Australia’s wage growth data on Wednesday is also very important as RBA wants to see wage growth of 3% before raising the interest rate. AUDUSD posted a fresh low of 0.72777 last Friday afternoon before recovering steadily throughout the session. U.S. President Biden and Chinese President Xi will hold a virtual meeting today afternoon, easing the geopolitical tension around the two countries, and the risk appetite of the market seems to turn positive.
Asian stocks took a steady open as investors are waiting for the Tier 1 economic data from China and monitor bond market volatility impacted by high inflation and the prospect of tighter monetary policy. Bond market expectation for inflation over the coming decade has risen to the highest level since 2006. Federal Reserve Bank of Minneapolis President Neel Kashkari suggested that the Fed should not overreact to the elevated inflation even it has impacted the market because it is likely to prove temporary. Treasury Secretary Janet Yellen said controlling the Covid-19 in the U.S. is the key to easing price pressure.
If you want to discuss how a how we can help your business protect itself from further declines in the AUD/USD, please get in contact your account manager or email us on sales@cafx.com
AUDUSD Daily Chart:
Major moves in the market:
Stocks
- The S&P 500 rose 0.72% , closed at 4682.85
- The Nasdaq 100 gained 0.04%, closed at 16200.00
- The Dow Jones Industrial Average rose 0.50%, closed at 36100.31
- S&P/ASX 200 gained 0.83%, closed at 7443.00
Currencies
- The Japanese yen was at 113.90 per dollar
- The offshore yuan traded at 6.3775 per dollar
- The Bloomberg Dollar Spot Index fell 0.2% Friday
- The euro was at $1.1448
Bonds
- The yield on 10-year Treasuries advanced one basis point to 1.56%
Commodities
- Brent crude oil was at USD/Bbl 82.29
- Gold was at USD/OZ 1866.25
- Iron ore was at USD/T 93.40
