AUD Holds Gains as Risk Sentiment Improves

AUD

The Aussie Dollar opens flat against the majors this morning as markets anticipate a pending peace deal with the US and Iran. President Trump spoke earlier this morning and said that the US is holding talks with Tehran currently and would prefer an agreement to further military action. Asian equities ended higher yesterday with the Nikkei +3.7%, Shenzhen +1.2% and Hang Seng +0.2%. Locally the ASX 200 closed +1.4% as materials and technology sectors outperformed at +3.6% and +2.5%. No major domestic news out yesterday as markets shift their attention to the RBA’s interest rate decision next Tuesday. Across Asia, the Chinese RatingDog Services PMI printed at 50.4 against a 53.7 consensus, down from 54.1.

USD

AUDUSD opens flat at 0.7057 and reaches a seven week high, as softer US data and improved risk sentiment weaken the US Dollar. A mixed session on Wall St. saw the Dow Jones close +0.7%, the Nasdaq -0.7%, and the S&P 500 unchanged on the day. US 10-year yields were steady at 4.62%, while Brent Crude remained below $80 a barrel. Yesterday saw the release of ADP Non-Farm Employment Change, which released at 44K (exp. 68K) and ISM Services PMI at 54.1 (exp. 54.5). Later this evening, US Unemployment Claims are set for release and are currently forecasted at 203K from a previous 197K.

EUR

AUDEUR opens flat at 0.6108 as the currency pair traded tightly between 0.6100 and 0.6114 over the past 24 hours. European equities were slightly down on the close, with the DAX -0.3% and CAC +0.0%. Yesterday saw some minor revisions to the Services and Manufacturing PMIs out of the Eurozone which did little to move markets. Later this evening, Retail Sales m/m is set for release and is currently forecasted at 0.1% from a previous 0.2%.

GBP

The AUDGBP opens flat at 0.5241, trading sideways between 0.5277 and 0.5242 over the past 24 hours. British equities closed slightly higher with the FTSE +0.1%. UK Final Services PMI released yesterday at 51.7 from a previous 51.6 and within the details it indicated that it was the most upbeat assessment of the business outlook since February. England’s next major data piece will be their GDP m/m report next Thursday.

NZD

The AUDNZD opens flat at 1.1991, as the currency pair recovered from 3-month lows of 1.1914 on Tuesday. New Zealand’s jobs report yesterday showed a weakening unemployment rate of 5.6%, with the country struggling with recession possibilities over the past few years.