AUD Plays Waiting Game for Key CPI Report

AUD

AUD starting the day stronger, slightly up against all majors, awaiting the key U.S. inflation report this evening. Locally the ASX 200 finished relatively flat, despite strong gains of +3.2% across the energy sector. Asian equities ended the day mixed, Hang Seng +0.7%, Shenzhen -0.3% and the Nikkei -1.4%. Crude Oil prices up 5.5% overnight after the United States announced new sanctions on Russian oil exports to try to force a ceasefire in Ukraine. This morning, we had the Flash Manufacturing PMI coming in at 49.7 lower then previous 51.4 and Flash Services PMI coming out at 53.1 up from 52.4. Nothing out over the weekend and then all eyes to Wednesdays CPI releases.
 

USD

AUD/USD opens up at 0.6514 holding on to a slight gain overnight. Strength in the technology sector buoyed Wall St. overnight and saw the Nasdaq trading +.9%, the S&P 500 +.6%, and the Dow Jones +.3%. Confirmation coming from the White House that President Trump would meet President Xi next Thursday while it was also reported that a meeting with Putin was not off the table. Tonight, we will see Core CPI m/m, CPI m/m and CPI y/y which should have significant impact on the upcoming rate decision next Thursday due to the continued government shutdown and very minimal data released in the past 2 weeks. At current the Fed is looking to cut to 4.00% from 4.25%.
 

EUR

AUD/EUR saw similar movement to the AUD/USD with us holding on to the 0.56 handle at 0.5606. The DAX and CAC both closed up +0.2%. There was no data out for the Eurozone yesterday but today will have Flash Manufacturing and Services PMIs. The European rate decision will be released one week from today on Friday the 31st expecting to hold at 2.15% at the current moment.
 

GBP

AUD/GBP opens up at 0.4888, the FTSE closed +0.7%. No data released yesterday, today we will see Retail Sales m/m expected at -0.4% down from previous +0.5%. Later today will have Flash Manufacturing PMI and Flash Services PMI expected at 46.6 and 51.0 up from 46.6 and 50.8.
 

NZD

AUD/NZD opens up at 1.1322, slightly up from yesterday. No data released yesterday or today.