17th December – Daily Currency Market Report

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The Market in Brief:

  • AUD steady
  • US raise rates
  • Pound & Euro weaker
  • Gold $1,071

Market Events Due:

  • UK Retail Sales

 

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AUD/USD: As expected the US have increased interest rates by 0.25%. The decision which has been priced into the markets for some weeks now, did deliver some volatility, however the AUD opens relatively unchanged from yesterday’s levels. The Federal Reserve sighted improving job numbers as a key reason for increasing rates, however did sight a future raise would only be on the table should the inflation rate rise. No major data of notes for the following two days, so we’ll gauge how investors react to the decision and accompanying statement over the next 24 hours.

AUD/NZD: The Kiwi reacted much in the same vain to the AUD following the interest rate decision. We open this morning at similar levels to what we say yesterday. No major data out of either NZ or Aus for next few days, so these levels are expected to hold.

AUD/GBP: The AUD has gained ground on the Sterling overnight, as the interest rate decision pushed the pound lower against all major currencies. This push lower was further compounded by weaker than expected average earning and unemployment benefit figures out of the UK. Retail sales figures this evening could apply further pressure on the Pound if the numbers come in weaker than expected.

AUD/EUR: Much like the Pound, the EUR dropped immediately following the US interest rate decision, however German and French manufacturing data came in strongly yesterday, which managed to offset some of the losses. We open slightly higher this morning and will look to investors to guide the direction of the pair, with no major data of note out for the next two days.

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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