25th November – Daily Currency Market Report

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The Market in Brief:

                • AUD back at 1 month highs
                • RBA’s Steven’s upbeat
                • German Ifo Survey improves
                • US GDP up
                • US Consumer Confidence drops
                • Gold $1,075 & DJIA 17,850
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Market Events Due:

            • US Durable Goods
            • US Weekly Unemployment Claims

 

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AUD/USD: Has recovered short term losses as commodities bounced, as did equities, the US Dollar Index fell – as forecast and the RBA’s Governor Steven’s sees stronger growth based on the recent unemployment data. There is no major local data due today, so we should see a slow drift off these 1 month highs as we head towards US data this evening and also the US Thanksgiving Holiday tomorrow.

AUD/NZD: As per yesterday’s report, the pair edge higher still on RBA Governor Steven’s comments and a lack of NZ data. We do have NZ Trade Balance figures tomorrow that may slow the trend and that may be the only near term opportunity for A$ buyers to take advantage. Otherwise we appear set for highs seen in August 3 cents above.

AUD/GBP: Has hit 3 month old trend line resistance as the Bk of England Governor suggested interest rates are set to stay low for some time and recent data confirms growth is slowing in the UK and inflation is virtually non-existent. UK GDP is due Friday so we should see the technical hold and we’d suggest those buying Pounds act now.

AUD/EUR: Has hit 4 month highs, despite a solid pick up in the German Ifo Business Survey that improved to a 17 month high, (taken prior to “Paris”). The uptrend therefore continues as a flood of more Euro’s is expected into the system next month. On the charts our target level has been hit and we do look set for a test of levels seen in April that sit 5 cents above.

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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