Welcome to our daily market update, where we help keep you informed on the latest happenings in the world of FX.
If you have any questions or would like anything further explained, please don’t hesitate to reach out to your account manager or email info@cafx.com
Macro Report
The AUD/USD pair has bounced modestly after Yesterday’s sharp drop on BoJ’s surprise change to Yield Curve Control (YCC), which saw the pair set a fresh December low of 0.6629. While Japan’s move to widen the band under its YYC policy is “not an interest rate hike”, the doubling of the cap from +/- 0.25 has triggered bets that the developed world’s last dove may abandon its negative interest rates in the months ahead. Aided by a recovery in risk sentiment, the AUD/USD pair is now trading in the 0.6680 region. Still, upward momentum is weak as the Aussie is unable to take full advantage of the broad US dollar weakness.
The US Dollar Index (DXY) has given up a lot of its recent advances on a huge Japanese Yen rally, climbing by nearly 4% against the US dollar. The USD/JPY pair is trading at 131.72 at the time of writing, down 0.73%. As the BoJ marks a rare shift, it could mean the end of the mighty greenback.
AUD/USD Daily Chart
DXY (USD INDEX) Daily Chart
Major Global Markets
| Currencies | Level | Change (%) | |
| AUD/USD | 0.6680 | 0.03 | |
| AUD/JPY | 88.0990 | 0.14 | |
| AUD/CNH | 4.6498 | -0.54 | |
| DXY | 103.9640 | -0.72 | |
| Rates | Yield (%) | Change | |
| US 10 Yr | 3.69 | -0.85 | |
| Aus 10 Yr | 3.70 | -0.48 | |
| Equities | Level | Change (%) | |
| S&P 500 | 3,821.62 | 0.10 | |
| NASDAQ | 10,547.11 | 0.01 | |
| ASX 200 | 7,024.30 | -1.54 | |
| Commodities | Level | Change (%) | |
| Iron Ore | 110.00 | -1.79 | |
| Gold | 1,828.40 | 1.17 | |
| Brent Crude | 79.69 | -0.14 |
|