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.
U.S Fed May Cut:
The AUD and stocks have rebounded following the U.S Fed Bank meeting this morning in which Jerome Powell signalled looser monetary policy (rate cuts) could be on the way. Looser policy generally is seen as supportive for the economy and stocks but a drag on the local currency (USD), hence why equities moved higher and the USD lower.
AUD/USD which had looked to be threatening a move below 0.6800 on the wholesale market may now hold on to key support levels around where we are trading right now. The other positive for importers is that if the U.S Fed joins the RBA in cutting interest rates, then it will to some extent offset any rate cuts from the RBA, which may mean the lows are in for AUD/USD. Nothing is certain though in foreign exchange and trying to pick AUD levels is typically a waste of time, so I’ll continue to watch and wait for any confirmation of this.
U.K retail sales are out tonight along with the Bank of England’s interest rate decision, expectations are for no change to interest rates.
AUD EXCHANGE RATES:
AUD/USD – 0.6859
AUD/GBP – 0.5413
AUD/EUR – 0.6100
AUD/NZD – 1.0475
AUD/JPY – 74.144
All Ords (XAO) – 6,728
Gold – A$1,972/oz
Silver – A$21.99/oz
WTI – US$54.61/barrel
DATA RELEASES TODAY:
GBP – Retail Sales m/m
GBP – Official Bank Rate at 9.00pm
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