Market Update – 14th January 2019 – AUD Continues Good Start To 2019

Please note that the commentary below is factual information provided to a group of readers as a web blog, and where an opinion is expressed by the author, it is GENERAL ADVICE only.

Welcome back to the second wave of clients returning to work today after a long and deserved break. A quick recap, in case you missed it, a ‘flash crash’ occurred just after New Years which essentially wiped 3-4 cents off the AUD across the board in a matter of minutes, thankfully though it was short lived and the New Year has actually heralded a far better than expected start for the AUD. In fact AUD/USD is now trading close to 0.7200, while AUD/GBP is back near 0.5600 following fears of a no deal Brexit with Europe. Commodities prices and equities have also been performing better in the early part of the year with the ASX up over 200 points since January 2nd.

Latest From The U.S Fed & AU Housing:

The latest gyrations and musings from the U.S Federal Reserve suggest 2019 could see rates on hold, which would certainly be bullish for AUD/USD, however strong employment data out a week or so back may force the Feds hand with a further rate hike towards a more normal level of interest rates around 2.75-3.00%. The RBA will likely also keep rates on hold throughout 2019 as housing prices continue to deteriorate and lending dries up with the off chance of a rate cut to stimulate some inflation in the Australian economy.

Upcoming Data:

No economic data out today or tonight other than a little bit of Aussie inflation metrics. Inflation as suggested above has been near enough to non-existent recently and so the previous months reading of 0.00% is probably a good estimate on what to expect today. A number above say 0.2% inflation would be a surprise and perhaps a cause for a rally in AUD.

AUD EXCHANGE RATES:

AUD/USD – 0.7183

AUD/GBP – 0.5588

AUD/EUR – 0.6259

AUD/NZD – 1.0523

AUD/JPY – 78.013

USD/BTC – $3,487

OTHER MARKETS:

All Ords (XAO) – 5,834

Gold – A$1,784/oz

Silver –  A$21.61/oz

WTI – US$52.39/barrel

DATA RELEASES TODAY:

AUD – MI Inflation Gauge m/m at 11.00am

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Patrick Downes

Senior Corporate FX Dealer

Phone Patrick – 0431 278 632 

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