Aussie Dollar Dives as US Tech Stocks Sell Off

AUD

The Aussie Dollar opens in the red across the majors in the aftermath of large falls in US equities and some discouraging comments from RBA Deputy Gov Hauser yesterday evening. Asian markets were mixed, as the Hang Seng gained 3.7% and Shenzhen 0.3% while the Nikkei fell 1.8%. At home, the ASX 200 rallied 2.6%. Hauser spoke at the Australian National University in Canberra yesterday, noting that Australians are currently losing confidence in the RBA's ability to bring inflation down following a fifth interest rate hike earlier this week. Data-wise, Australia’s Goods Trade Balance data came in above expectations at A$2826m (exp $1000m). Looking ahead, the domestic economic calendar is looking bare as the next major release comes Nov 19th with the release of our employment report.
 

USD

AUDUSD opens to fresh three-week lows at a rate of 0.6926 as US equity markets tumbled overnight in the hangover of the midterm elections which has soured risk sentiment. On Wall St, the Nasdaq came in -5.2%, the S&P 500 -4.1%, and the Dow Jones -3.3%. The fall in US stocks is largely attributed to concerns about potential hurdles to artificial intelligence's rapid expansion as voters sided against data centres in 40 of 41 ballot measures. US Unemployment Claims data released overnight, coming in at 189k (exp 196k) from a previous 195k. Some more employment data expected tonight, with Average Hourly Earnings m/m, Non-Farm Employment Change and the Unemployment Rate set for release.
 

EUR

AUDEUR dipped overnight, opening at 0.6175 as markets remain uncertain of the implications post US midterm election. European equities were mixed, with the DAX and CAC coming in at -0.4% and +0.3% respectively. Eurozone PPI m/m data released in line with expectations of +2.5% (prev 2.0%), although there was little reaction from the market. Some more minor data out today with German Industrial Production m/m, French Trade Balance and Retail Sales m/m.
 

GBP

AUDGBP took a hit overnight, opening at 0.5150 after the Bank of England decided to hike rates by 25bps. The decision was in line with expectations with the vote 8-1 in favour, with the dissenter preferring a 50bp hike instead. UK equities closed in the red at -0.4%. The statement released by the BoE following the hike indicated that more hikes could be on the way until a resolution in the Middle-East occurs. Some minor data later today for the UK with Lloyds HPI m/m and MPC Member Pill is set to speak about the Monetary Policy Report.
 

NZD

AUDNZD opened down at a rate of 1.2383 due to risk sentiment souring overnight from the tech stock sell off. No data out yesterday or today as New Zealand heads into tomorrow’s Parliamentary Elections.