13th October – Daily Currency Market Report

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The Market in Brief:

  • AUD strengthens again
  • NZD strengthens
  • EUR weakens
  • Gold $1,164

Market Events Due:

  • Chinese Trade Figures
  • NAB Business Confidence
  • GBP Inflation data
  • German Economic sentiment

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AUD/USD: The Aussie opens higher once again this morning, continuing with the momentum it built from late last week. The rise in the AUD overnight was mainly off the back of comments out of the US, which hint that the federal reserve will hold rates this month, with a December hike or a 2016 hike looking likely. This rise was further aided by comments from RBA deputy governor Lowe, who indicated the RBA was happy with the direction of the Aussie economy. We look toward Chinese trade figures today for further indication.

AUD/NZD: The Kiwi once again enjoyed a strong rally overnight against the USD, however this climb was in line with movements in the AUD, thus we open this morning at the same levels seen yesterday. No domestic data of note out of NZ today, so we expect these levels to hold overnight.

AUD/GBP: The GBP rose strongly against the USD overnight, however was unable to match the strength of the AUD, as the Aussie continues to gain ground on the Sterling. Attention turns towards domestic inflation data this evening in the UK, with strong numbers likely to add fuels to the flame of a UK rate hike next year.

AUD/EUR: The AUD continued to gain ground on the EUR overnight, as the EUR enjoyed a relatively quiet trading day, mainly due to a US public holiday. Very little in terms of European data due this evening, with the only announcement coming from Germany in the form of economic sentiment figures, which is widely expected to come in below expectations.

ALTERNATIVE CURRENCY HEDGING: Ask us about a great alternative to traditional forward contracts that give the ability to cover at attractive levels, but with the flexibility to walk away should the spot rate improve or the contract not be required. 

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Jim Devonport

Corporate & HNW Client Manager 

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