Aussie Dollar Slides on Failed Peace Talks
AUD
The Aussie Dollar starts the week lower against the major currencies after risk sentiment soured following news that no agreement had been reached between the US and Iran during talks in Pakistan. Asian equities ended higher across the board on Friday, the Nikkei +1.8%, Shenzhen +1.5% and the Hang Seng +0.5%. Locally the ASX 200 shed -0.1% as technology and materials sectors led losses at -1.8% and -0.7%. In Australia this week, we will receive some key data for March that may provide some insight into how the economy has been affected by the Middle East conflict and higher fuel prices. On Tuesday, the monthly NAB business survey will provide information on business confidence, activity, and new orders, as well as pricing (inputs and output). The main event of the week however will be our employment data on Thursday with Employment Change expected to come through at 17.95k, and the Unemployment Rate which is expected to remain unchanged at 4.3%.
USD
AUDUSD opens lower this morning at 0.7019 after peace talks failed between the US and Iran causing risk sentiment to drop. President Trump also said that the US would begin blockading all ships entering or leaving the Strait of Hormuz. Over the weekend US CPI for March printed at +0.9% MoM as expected and Core CPI was +0.2% MoM, short of expectations of +0.3%. YoY numbers were lower than expected with headline CPI at +3.3% and Core CPI at 2.6%, both 0.1% lower than forecasts. US Equities closed mixed with the Dow Jones -0.6%, S&P 500 -0.1%, and the Nasdaq +0.4%. Looking at US news this week the main headline will currently be focused on the ongoing Middle Eastern conflict, however tomorrow night we will also get Core PPI m/m expected to remain the same at 0.5%, and PPI m/m expected to jump to 1.2% from 0.7%.
EUR
AUDEUR opens lower this morning at 0.6014 off of sullied risk sentiment. Nothing out of Europe over the weekend and Eurozone equities remained mostly flat with the DAX 0.0% and the CAC +0.2%. Nothing major set for release out of the Eurozone this week either with the main market movers being ECB President Legarde speaking in the US on Wednesday and Thursday morning.
GBP
AUDGBP opens lower to start the week at 0.5241. Nothing out of the UK over the weekend, and UK equities had no reaction with the FTSE closing flat at 0%. A quiet day on the economic calendar, however tomorrow will have BRC Retail Sales Monitor y/y, and MPC Member Mann Speaking. The main event of the week will however be UK GDB m/m which is expected to increase slightly from 0% to 0.1%.
NZD
AUDNZD opens slightly higher to start off the week at 1.2097 after this morning’s BusinessNZ Services Index came through lower than previous at 46.0 from 47.6. It will be quite the busy week for our Kiwi neighbours this week with Visitor Arrivals m/m tomorrow, followed by RBNZ Gov Breman Speaking on Thursday morning, and FPI m/m on Friday to close off the week.