Market Update – 8th November 2019 – Investor Sentiment Improves As U.S/China Edge Towards Deal

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/China Deal Optimism:

Optimism about a trade deal between the U.S and China, and subsequent roll back of tariffs – put in place over the past 2 years – has spurred markets to post solid gains overnight. Markets improved right across the board with the AUD edging higher alongside equities and commodities, while traditional safe havens Bonds, Gold and Silver retreated. AUD/USD edged higher by around 10-15 points, while AUD vs. the JPY, GBP and EUR fared better adding around 0.5%. Our local market is tipped to open 0.2% higher following positive finishes across U.S and European equity markets.

RBA Monetary Policy: 

We hear from the RBA again today. Monetary policy minutes from their latest meeting on Tuesday are due at 11.30am. Earlier in the week the RBA chose to keep rates on hold at 0.75%, however comments and nuances in the accompanying report suggested we might be nearer to the end of this current cycle of loosening monetary policy. The report released at 11.30am is more in depth compared to the accompanying statement released Tuesday afternoon so expect markets to watch this closely for hints on the RBA’s next move, if any! Home loans data is released at 11.30am also and is expected to see 2.1% growth in new loans.

AUD EXCHANGE RATES:

AUD/USD – 0.6869

AUD/GBP – 0.5352

AUD/EUR – 0.6216

AUD/NZD – 1.0805

AUD/JPY – 75.088

OTHER MARKETS:

All Ords (XAO) – 6,836

Gold – A$2,129/oz

Silver –  A$24.83/oz

WTI – US$56.89 barrel

DATA RELEASES TODAY:

AUD – RBA Monetary Policy Statement at 11.30am

AUD – Home Loans m/m at 11.30am

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Patrick Downes

Senior Corporate FX Dealer

Phone Patrick – 0431 278 632 

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