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.
That Old Saying:
“Sell in May and Go Away” is the old adage and it appears to be holding true once again with the early part of the month seeing a sustained sell off right across the board. Risk assets such as the AUD, Equities and Commodities have all come under selling pressure since Wednesday, while safe havens like the Greenback and Yen have seen positive momentum. I’m hoping now that I’ve written it down, we’ll see a change in fortunes and the AUD, Equities and Commodities start performing a bit better. We will see.
New home sales came in week again yesterday, with the index slipping 0.1% and continuing a pretty poor showing over the past year. In the U.K the Bank of England held rates steady again at 0.75% with all members 9 of 9 agreeing this was the right course of action. AUD/GBP was little moved overnight.
Building Approvals & Non Farms:
Ahead today is more housing data with local building approvals released around midday. Expectations are for another large correction to the downside and like new home sales the data has been horrendous over the past year. One thing is obvious, a change in sentiment in the housing market is still a ways off. Tonight we’ll see the latest employment numbers out of the U.S. The unemployment rate currently stands at 3.8%
An interest rate cut from the RBA, while likely to support equities and to a lesser degree house prices would see the AUD continue to decline. We’ll here from the RBA next Tuesday.
AUD EXCHANGE RATES:
AUD/USD – 0.6968
AUD/GBP – 0.5339
AUD/EUR – 0.6232
AUD/NZD – 1.0547
AUD/JPY – 77.778
All Ords (XAO) – 6,430
Gold – A$1,815/oz
Silver – A$20.90/oz
WTI – US$61.64/barrel
DATA RELEASES TODAY:
AUD – Building Approvals m/m at 12.30pm
USD – Non-Farm Employment Change & Unemployment Rate at 11.30pm
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Senior Corporate FX Dealer
Phone Patrick – 0431 278 632
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