AUD Maintains Momentum

AUD

The Aussie Dollar opens up against all the majors this morning as Labour’s win strengthens the AUD. The Labour majority allows the government more scope to pass legislation and ramp up fiscal spending if the US trade war poses any threat to the economy. Asian equities were mixed, SHANGHAI COMP -0.2%, NIKKEI 1%, and locally the ASX -1%. Commodities were mixed, Gold 0.7%, Silver 0.5%, Copper 0.7% and Crude Oil -2.2%. This morning, China has their Caixin Services PMI expected at -0.6%. Very light data week ahead for China and Australia.
 

USD

The AUDUSD pair opens up at 0.6464 after hitting 5-month highs of 0.6493 overnight. Wall Street ended the day in the red, DOW JONES -0.2%, S&P 500 -0.6% and NASDAQ -0.7%. The US had their ISM Services PMI come in above expectations overnight at 51.6, although well-below the six-month average of 52.5 and a large pullback from December's 54.0. The Fed will focus on the 4.2% surge in prices paid to 65.1 - the highest reading on this price index since January 2023. Thursday is the main talking point of the week for the US as the Fed has their interest rate decision where they are expected to hold at 4.5%.
 

EUR

The AUDEUR pair continues to strengthen as it opens up at 0.5714. European equities were mixed, DAX 1.1% and CAC -0.5%. No data events of note yesterday for the Euro. Looking ahead it is a fairly quiet week for the Euro. They do however have their Retail Sales M/M tomorrow expected flat in April.
 

GBP

The AUDGBP continues its recovery as it opens up at 0.4864 this morning. The FTSE ended the day up 1.2%. The main event for the week is the Bank of England rate decision on Thursday where they are expected to cut rates by 25 points to 4.25%.
 

NZD

The AUDNZD opens up at 1.0844 this morning, gaining 0.8% since the beginning of May. Tomorrow the Kiwis have their Employment Change Q/Q figures expected to uptick slightly from -0.1% to 0.1%. They also have their Unemployment Rate expected to increase from 5.1% to 5.3%. This is likely to have a bearing on their interest rate decision later this month where the RBNZ is 75% priced to cut rates by another 25 points.