AUD Edges Higher on Lower Fed Hike Bets

AUD

The Aussie Dollar opens the week a touch higher against the majors following a quiet weekend of trading due to the Independence Day long weekend in the US. Asian equities finished higher across the board yesterday with the Nikkei trading +1.5%, Hang Seng +1.3% and Shenzhen +0.6%. The ASX 200 ended 1.4% higher as healthcare and materials sectors outperformed at +2.7% and +2.5%. It looks to be a very quiet week ahead in terms of data releases for the Aussie. Today will see some minor data with the MI Inflation Gauge m/m and ANZ Job Advertisements m/m. The most notable event this week will be a speech by RBA  Assistant Governor Sarah Hunter and a panel discussion about macroeconomic policy at the Australian Conference of Economists, in Canberra on Wednesday.

USD

AUDUSD opens this morning slightly up at a rate of 0.6937, after a weekend of limited movement as major currencies traded in small ranges. A quiet session to round out the week with US equity markets closed for the Independence Day long weekend. WTI Crude was +0.1% higher to US$68.80/barrel, whilst the yield on the US 10 year note was unchanged at 4.48%. For the US, the ISM Services Index for June is set to be released tonight. The index improved in May, reaching 54.5, while its employment sub-index moderated slightly to 47.9. This is expected to improve for June, but nevertheless remain in contractionary territory. Looking ahead to the rest of the week, the major focus will be on Thursday with the FOMC Meeting Minutes and Unemployment Claims set for release.

EUR

AUDEUR starts the week slightly up at 0.6065 after trading sideways for the weekend. European equity markets closed in the green with the DAX and CAC up +0.8 and +0.4% respectively. Late on Friday, eurozone Final Services PMI released at 49.4, beating expectations of 48.9 and signalled a stabilisation in the economy after two months of moderate decline in business activity. ECB President Lagarde also spoke at the Aix-en-Provence Economic Meetings in France, and noted that the door is open to an early ECB exit for her as she considers a move into French politics.

GBP

AUDGBP opens the week higher at a rate of 0.5196, just shy of recovering the .52 mark. UK equities closed in the green, with the FTSE +0.2%. The week ahead is looking quiet on the data front, with the main focus on Thursday when BOE Gov Bailey will be holding a press conference about the Financial Stability Report, in London.

NZD

AUDNZD begins the week flat at 1.2158. Later this morning, some minor data is set to release with ANZ Commodity Prices m/m. On Wednesday the Reserve Bank of New Zealand will meet to decide on interest rate settings. While a hold is the popular tip, it could be a close-run thing and perhaps with a split vote again.