Market Update – 5th March 2019 – AUD/USD Falls Marginally Ahead Of RBA Meeting

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.

Overnight:

U.S equities fell overnight with the Dow the worst performer off 0.85%, while over in Europe stocks finished mostly higher with the French CAC leading the charge up 0.41% at the close. The Aussie Dollar is marginally lower vs. the USD, NZD and JPY but higher versus the Euro and Pound as both retreated in overnight trade.

Big Day Of Data Yesterday:

A big day of data yesterday saw the release of jobs numbers and building approvals with latter firming ever so slightly from the previous month however the trend remains lower and sharply so with total dwellings down over 27% year over year; excluding houses (i.e. Apartments) and you’re looking at a decline in excess of 46% year over year. ANZ Job Ads also declined.

Cash Rate Decision At 2.30pm:

Ahead today is the all important cash rate decision at 2.30pm, however rates are likely to remain on hold again at 1.5% with all eyes on the accompanying RBA Rate Statement released at the same time. Housing is the word on everyone’s lips right now, so we’d expect to some opinion from the RBA and also some guidance on perhaps their next move. A strong suggestion from the RBA that a rate cut is on the cards soon would likely to see the AUD swiftly sold off, perhaps towards support around 0.6970.

Hedging Strategy: 

Many of you have locked in Forwards in the 0.70’s recently but many still have not, if you’d like to look at this as a prudent hedging strategy to protect your profit margins from a decline in the AUD then please don’t hesitate to call me for a quick discussion – I’m here to help. Exporters you’re sitting pretty.

AUD EXCHANGE RATES:

AUD/USD – 0.7059

AUD/GBP – 0.5350

AUD/EUR – 0.6221

AUD/NZD – 1.0364

AUD/JPY – 78.915

OTHER MARKETS:

All Ords (XAO) – 6,302

Gold – A$1,814/oz

Silver –  A$21.28/oz

WTI – US$56.70/barrel

DATA RELEASES TODAY:

AUD – Current Account at 11.30am

AUD – RBA Rate Statement and Cash Rate at 11.30am

GBP – BOE Gov Carney Speaks at 2.35am (tomorrow morning)

Sign up for a Compass account today and access some of the most competitive rates in the business and arguably the best service.

 

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Patrick Downes

Senior Corporate FX Dealer

Phone Patrick – 0431 278 632 

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