Aussie Dollar Flat as US CPI Meets Expectations

AUD

The Aussie Dollar opens largely flat against the major currencies as US inflation data prints in line with expectations. Asian equities ended mixed yesterday with the Nikkei +0.8%, Shenzhen +0.6% and the Hang Seng at -0.8%. The ASX 200 closed -0.5% as real estate and consumer discretionary sectors led losses at -1% and -0.8% respectively.  Yesterday saw minimal data out of Australia and Asia following Tuesday’s RBA interest rate decision. Consumer Inflation Expectations for August will be out later this evening, with the previous print being 4.7%. A reading above could put pressure on the Reserve Bank of Australia to increase rates.

USD

AUDUSD opens flat at 0.7062, as the monthly American inflation figures came in largely as expected. Wall St. rose slightly with the Nasdaq closing +0.5%, the S&P 500 +0.3%, and the Dow Jones unchanged on the day. U.S. 10-year yields were steady at 4.69%, while Brent Crude fell slightly to $88.70 a barrel. The figures released met expectations exactly, with Core CPI m/m +0.2%, Core CPI y/y +2.5%, CPI m/m +0.1% and CPI y/y +3.4%. Tonight will see further inflation figures from the producers, with PPI m/m expected to release, with both headline and core measures expected to accelerate on a monthly basis.

EUR

AUDEUR opens slightly higher at 0.6127, with the currency pair touching 2-week highs last night of 0.6131. European equities fell slightly, with the DAX -0.2% and CAC -0.5%. No major economic data out of the Eurozone yesterday, however today will see Industrial Production m/m release, currently forecasted at -0.1%.

GBP

AUDGBP opens flat at 0.5233 this morning. British equities closed slightly lower overnight, with the FTSE -0.1%. A busy day on the economic calendar for the UK with the main release being GDP m/m (exp. 0.0%) and Prelim GDP q/q (exp. +0.4%). Goods Trade Balance and Industrial Production m/m will also be released later this afternoon.

NZD

AUDNZD opens higher at 1.2056, touching 2 week highs due to improved risk sentiment. Later this afternoon will see the release of NZ Inflation Expectations q/q, previously releasing at 2.53%. Visitor Arrivals m/m and BusinessNZ Manufacturing Index out tomorrow to close the week for the Kiwi.