Market Update – 15th October 2019 – AUD Drifts On Waning Trade Optimism

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.

AUD Drifts:

The AUD has drifted marginally lower over the past 24 hours – a result of waning optimism about a proposed trade deal between China and the U.S in which China is said to have agreed to increase it’s “purchases of US farm products” among other things. Stock markets also dipped, but again not by much with the biggest loser being the S&P 500 which lost only 0.14%. Our local market is set to open around 0.3% lower today after a strong day yesterday.

Protests Globally:

On the geopolitical front and while protests in France have receded recently, far reaching protests continue to flair in Hong Kong and more recently Ecuador where we have seen massive protests against austerity measures and a scrapping of fuel subsidies. The clashes certainly give us all a bit of perspective on how lucky we are to live in a very stable economic environment like that in Australia. And also how lucky we are to have a reasonably stable local currency in the AUD.

RBA Minutes Due: 

Minutes from the latest RBA meeting are due at 11.30am this morning and should give us some more insight into the reasoning behind the RBA’s second rate cut in four months. Expectations are that stagnant wage growth and continued sluggish retail spending is behind the reasoning to cut rates. How much further the RBA cut rates remain to be seen but we will certainly get more clarity as to whether or not more cuts are in the pipeline with these latest minutes.

AUD EXCHANGE RATES:

AUD/USD – 0.6744

AUD/GBP – 0.5331

AUD/EUR – 0.6115

AUD/NZD – 1.0727

AUD/JPY – 73.140

OTHER MARKETS:

All Ords (XAO) – 6,757

Gold – A$2,203/oz

Silver –  A$26.06/oz

WTI – US$53.51 barrel

DATA RELEASES TODAY:

AUD – Monetary Policy Meeting Minutes at 11.30am

GBP – BOE Gov Carney Speaks at 7.30pm

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Patrick Downes

Senior Corporate FX Dealer

Phone Patrick – 0431 278 632 

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