Market Update – 6th November 2019 – Aussie Dollar Declines Despite Hints RBA Easing Cycle Has Ended

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.

RBA Holds Rates:

The RBA chose to hold rates Cup Day while hinting in their minutes that the current easing cycle may have concluded. In all we’ve seen three rates cuts from the RBA since June with benchmark interest rates dropping from 1.5% to 0.75%. The cuts equate to halving of interest payments for borrowers, which should (in economic theory) see demand and growth pickup. However, as many us know economic theory is often just theory and in reality things are very different. AUD/USD which has moved above 0.6900 earlier in the week is now trading back below this key level, however a proper end to the easing cycle could provide support for the AUD over the later part of the year.

But, it all comes down to interest rates and economic sentiment so lets wait and see.

Quiet Day For Data:

We’ve got a very quiet 24 hours ahead in terms of economic data with no tier 1 data released until Thursday evening when we’ll see the Bank of England set interest rates and EU Economic Forecasts. Overnight, U.S and European stocks finished the session mixed the S&P500 and NYSE down, while the Dow and Nasdaq edged higher. Our local market is set to open pretty flat.

AUD EXCHANGE RATES:

AUD/USD – 0.6864

AUD/GBP – 0.5321

AUD/EUR – 0.6195

AUD/NZD – 1.0759

AUD/JPY – 75.001

OTHER MARKETS:

All Ords (XAO) – 6,811

Gold – A$2,153/oz

Silver –  A$25.54/oz

WTI – US$57.25 barrel

DATA RELEASES TODAY:

None.

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Patrick Downes

Senior Corporate FX Dealer

Phone Patrick – 0431 278 632 

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