AUD Holds Steady as Hormuz Tensions Persist

AUD

The Aussie Dollar opens the day mixed across the major currencies following the seizure of two container ships in the Strait of Hormuz, which has cast some doubt on how long the region will remain peaceful. Asian equities finished mixed yesterday with the Shenzhen +0.7%, the Nikkei +0.4% and the Hang Seng -1.2%. Locally the ASX 200 closed -1.2% as health care and financials sectors led losses, falling -6% and -2.3%, respectively. Yesterday was quiet data wise as geopolitical headlines dominate the market narrative and cap any upside for the Aussie. Earlier this morning Australian Flash Manufacturing and Services PMI data released at 51.0 and 50.3, showing a slight increase in growth from last month. 

USD

AUDUSD opens slightly up at 0.7158 from yesterdays open, holding on Iran’s next move following increased tensions in the region post ceasefire extension. A strong session for U.S. equities saw the S&P 500 trade at all-time highs, largely driven by strong earnings from Boeing and Tesla and a rally in AI stocks. On Wall St. the Nasdaq closed +1.6%, the S&P 500 +.9%, and the Dow Jones +.7%.  U.S. 10-year yields rose slightly to 4.30%, while Brent Crude rose 3% to $101.40 a barrel. Later today US Flash Services and Manufacturing PMIs are set to release, currently forecasted at 50.5 and 52.5 respectively, Revised UoM Consumer Sentiment out this Saturday, expected 48.5 from 47.6. 

EUR

AUDEUR trades in the green gaining the .61 handle to open at 0.6114. European equities closed in the red with the DAX down -0.3% and the CAC -0.2% respectively. Busy day data wise in Europe with French, German and Eurozone Manufacturing and Services PMIs due to come out this afternoon and are all currently forecasted to show a retraction from the previous month.

GBP

AUDGBP opens relatively flat but regains the 53 handle to open at 0.5301. The FTSE also closed in the red at -0.2%. Alike the rest of Europe and Asia, the UK have their Flash Manufacturing and Services PMIs expected at 50.3 and 50.0 respectively, showing a retraction from last month. Looking ahead, Retail Sales m/m is set to release tomorrow and is forecasted at -0.4% from last month’s reading.

NZD

AUDNZD opens slightly down at 1.2123 as the NZD strengthens off the back of Tuesday’s quarterly CPI data, which has increased the likelihood of a rate hike in July. No major data ahead to close out the week.