AUD Dips as Iran Sanctions Sour Risk Appetite

AUD

The Aussie Dollar opens the day lower against the majors as risk sentiment soured overnight following the US announcement of sanctions against Iran and its trading partners. Asian equities were mixed yesterday with the Nikkei closing -.7%, Hang Seng -1.9% and the ASX 200 -.5%. No data released yesterday, but today the main event will be at 11:30am with the release of the RBA's Monetary Policy Meeting Minutes. The RBA minutes will clarify the Board's thought process behind holding rates at the last meeting and may provide clues on which way they will go next, directly determining if Australian interest rates face further hikes and steering short-term AUD volatility.

USD

The AUDUSD opens the day lower, with the pair slipping since yesterday morning, opening at a rate of 0.7150. A mixed session on Wall St. to start the week saw the Nasdaq close -.8%, the S&P 500 -.3%, and the Dow Jones +.3%.  U.S. 10-year yields closed -3bps at 4.7%, while Brent Crude fell 2.6% to $91.90 a barrel. Last night saw US Treasury Secretary Scott Bessent announce new Iran secondary sanctions, with Trump asking world leaders to cooperate. The new measures aim to give a final warning to countries to sever their business ties with Iran or risk having key companies and entities cut off from the US dollar-based financial system. Tonight will see CB Consumer confidence set to be released, looking to keep steady at 90.8. 

EUR

AUDEUR opens flat this morning at 0.6129 after what was an uneventful day out of the Eurozone with nothing released. European equities closed in the red with the DAX and CAC -0.1% and -0.4% respectively. Little in the way of meaningful data out of the Eurozone this week, some minor data out today with the German Final GDP q/q, German ifo Business Climate and Belgian NBB Business Climate. 
 

GBP

AUDGBP opens flat this morning at 0.5244. UK equities closed in the green with the FTSE +0.3%. Nothing in the way of news out of the UK yesterday and it will be another quiet day today. Tomorrow however we will get their CBI Realized Sales which will be the last data release for the week.

NZD

AUDNZD opens slightly lower this morning at 1.1991 after yesterdays mixed retail sales data, which showed Core Retail Sales up from forecasts of 0.3% at 0.7%, while Retail Sales q/q dropped significantly coming under forecasts of 0.1% at -0.5%. Nothing else to note from our Kiwi neighbours this week as they have no further news releases.