AUD Trades Sideways in Data Drought
AUD
The AUD held a tight range against the majors over the weekend, with a lack of domestic data leaving movement largely dictated by shifts in other key pairs. Equities were firmer, with the ASX up 0.7% and the Shanghai Composite gaining 0.8%, reflecting a modestly positive risk tone in the region. Data-wise, it will remain relatively quiet in the near term, with the next major event being the Jackson Hole Symposium on the 23rd, where central bankers and policymakers gather to discuss global monetary policy and economic outlooks. Tomorrow, we'll see Westpac Consumer Sentiment data.
USD
AUD/USD opens higher this morning at 0.6510 after a few key data points coming in below expectations, most notably U.S. Retail Sales m/m. The softer data limited upside momentum, though broader USD moves provided some support for the pair. US equities edged lower, with the S&P down 0.3% and the NASDAQ slipping 0.4%. Friday’s data saw U.S. Core Retail Sales m/m at 0.3% (in line with forecasts, down from 0.8% prior), while the headline figure came in slightly below expectations at 0.5% versus 0.6% forecast, weakening the USD. On Saturday, the preliminary University of Michigan Consumer Sentiment for the US came in at 58.6, below the 61.9 forecast and 61.7 prior, while preliminary UoM Inflation Expectations rose to 4.9% versus 4.5% previously, adding to cautious sentiment in the USD. Data-wise, today and tomorrow are expected to be relatively quiet. Meeting Minutes from the latest Federal Reserve interest rate decision will be released on Thursday.
EUR
AUD/EUR opens lower this morning at 0.5559, weighed by softer risk sentiment and the Euro maintaining its appeal as a safe haven currency. European equities were mixed on Friday, with the DAX down 0.1% while the CAC rose 0.7%, reflecting diverging investor sentiment across the region. There was no major data over the weekend, and markets are expected to remain quiet until the 21st, when the flash Manufacturing PMI and flash Services PMI are scheduled for release.
GBP
AUD/GBP opens flat this morning at 0.4802, reflecting the lack of domestic or UK data over the weekend. However, with a busy week ahead in terms of economic releases, the pair could see increased volatility as new data flows in. UK equities edged lower on Friday, with the FTSE down 0.4%, as investors remain cautious ahead of a busy week of economic data. The next key release for the UK being the CPI y/y on Wednesday, which could drive volatility in both GBP and UK equities.
NZD
AUD/NZD came in flat this morning at 1.0983, reflecting a quiet weekend on the data front, with the pair recently being driven mostly by Australian factors. Markets are expected to remain subdued until Wednesday, when a major data and policy day is scheduled for New Zealand, including the Official Cash Rate, RBNZ Monetary Policy Statement, Rate Statement, and Press Conference.