27th November – Daily Currency Market Report

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The Market in Brief:

                    • AUD consolidates
                    • Australian Private CAPEX drops
                    • US holiday ensured tight ranges

                    Gold to $1,071 & DJIA 17,878

          •  

Market Events Due:

                • Spanish Inflation
                • UK GDP

 

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AUDUSD: The Australian Dollar dropped sharply following domestic Private CAPEX numbers that fell nearly 10% over the last quarter and 20% over the last year. The result was a near 50 point drop, however with the US on holiday and the market more concerned with the upcoming RBA meeting we saw price action hug the days lows. There is no major data due until next Tuesday’s central bank announcement, where there is a widespread view of rates being held at 2%, so we’ll expect current levels to hold until then.  

AUDEUR: The poor Australian data release meant a continuation of the short term correction during our session, that we saw start Wednesday evening. The retracement petered out and we saw virtually no movement for the rest of the day. The only data due this evening is Spanish inflation and that is of just passing interest, therefore we should see the recent highs cap until early next week at least. 

AUDGBP: A similar trading pattern was seen here as with other A$ crosses, due to the weaker local data, lack of UK numbers and the US holiday. UK GDP is due this evening and is expected to be the highlight for the whole day and any read either side of +0.5% for the quarter should see Sterling react accordingly. This pair is fairly overbought so we could well see lower levels next week. We’d suggest placing orders to take advantage of any temporary spikes.  

AUDNZD: The Tasman cross actually pushed on to hit 2 month highs, despite the weaker Australian data, although has dipped somewhat toward the close. The overnight highs should cap as we head towards the weekend and Mondays NZ Business Confidence.   

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Jim Devonport

Corporate & HNW Client Manager 

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