AUD Jumps on Easing US-China Tensions

AUD

The Aussie Dollar opens stronger against most majors after China granted some tariff exemptions for U.S. imports, raising hopes that the trade war between the world's two largest economies may be closer to abating. U.S. President Trump also suggested a de-escalation of their tit-for-tat tariff battle, saying direct talks were already underway. Asian equities closed the week on a positive note with the Nikkei +1.9%, while the Hang Seng and Shenzhen were +0.3% and +0.1% respectively. The ASX 200 gained +0.6% on Thursday and was closed on Friday for the ANZAC Day public holiday. Commodities were mostly down across the board with Natural Gas and Sugar being the biggest movers at -3.3% and +1.8% respectively. A quiet long weekend for data in Asia and Australia. RBA Assist Gov Kent will be speaking tomorrow morning at an event hosted by Bloomberg, in Sydney. No data for the Aussie until Wednesday, where we have the major quarterly inflation report (The RBA's preferred inflation gauge). Expectations are for CPI q/q (exp. 0.8%, prev. 0.2%), CPI y/y (exp. 2.4%, prev. 2.4%) and Trimmed Mean CPI q/q (exp. 0.6%, prev. 0.5%). Markets are toying with a potential 50bps interest rate cut from the RBA at their May 20 meeting, although the general consensus is for a 25bps cut, which would take the Cash Rate to 3.85%. On Wednesday the Chinese Non-Manufacturing PMI expected at 50.7, previously 50.8.
 

USD

AUDUSD opens stronger at 0.6380 after touching weekend highs of 0.6437. Another positive session to round out last week saw the Nasdaq close +1.3%, the S&P 500 +0.7%, and the Dow Jones +0.1%. Americans are still dreading a recession and rising inflation due to Trump’s tariffs, Consumer sentiment in the United States declined further in April, standing at 52.2, according to a final monthly report published by the University of Michigan on Saturday. A quiet Monday for the US. Tuesday, we have S&P/CS Composite-20 HPI y/y, expected at 4.6%. GDP and Employment data out tomorrow evening.
 

EUR

AUDEUR opens minorly stronger at 0.5626, steadily climbing up from Friday's open of 0.5617. The DAX gained +0.8% and the CAC gained +0.4% on Friday. No Eurozone data released on Friday. Spanish Unemployment Rate out this evening, expected at 10.7%. German GfK Consumer Climate (exp. -25.6, prev. -24.5) Spanish Flash CPI y/y (exp. 2.0%, prev. 2.3%) and Spanish Flash GDP q/q (exp. 0.7%, prev. 0.8%) out tomorrow. 
 

GBP

AUD opens relatively flat on the Sterling at 0.4800. The FTSE closed +0.1%. On Friday, UK Retail Sales m/m came in above expectation at 0.4%, expected -0.3%. Today, yellow tier data, CBI Realized Sales expected at -21, previously at -41. No major data out for the Pound for the week.
 

NZD

AUDNZD opens the week stronger up 0.4% at 1.0733. A quiet long weekend for the Kiwis. ANZ Business Confidence on Wednesday is the next NZ data piece.