AUD/USD news - page 27

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AUD/USD Forecast Sep. 28-Oct. 2

AUD/USD posted sharp losses last week, as the pair slipped about 170 points and closed just above the 0.70 line. This week’s highlights are Building Approvals and Retail Sales. Here is an outlook on the major market-movers and an updated technical analysis for AUD/USD.

The Australian dollar was hit by yet another disappointing Chinese figure, showing slower projected growth. In the US, Yellen surprised with a relatively hawkish speech, and the week ended on a positive note as Final GDP for Q2 posted a strong gain. The battle around 0.70 continues.

  1. Building Approvals: Wednesday, 1:30. The week kicks off with this market-mover. This indicator tends to show a lot of fluctuation, which often means that readings are well off the forecasts. In July, the indicator bounced back with a sharp gain of 4.2%, easily beating the estimate of 2.9%. The markets are bracing for a decline of 1.9% in the August release.
  2. AIG Manufacturing Index: Wednesday, 23:30. This index has been moving upwards, and came in at 51.7 points in August, marking a 3-month high. Will the index continue to rise in the September release?
  3. Chinese Manufacturing PMI: Thursday, 1:00. The Australian dollar is sensitive to Chinese key data such as the Chinese Manufacturing PMI, as China is Australia’s largest trading partner. In August, the index slipped under the 50-line (which separates contraction from expansion), for the first time since February, with a reading of 49.7 points. This almost matched the forecast of 49.8 points. No change is expected in the September reading.
  4. Chinese Caixin Final Manufacturing PMI: Thursday, 1:45. This report follows last week’s Caixin Manufacturing PMI, which came in at 47.1 points in August, shy of the estimate of 48.1 points. The Final Manufacturing PMI is expected to confirm the earlier reading, with an estimate of 47.2 points.
  5. Commodity Prices: Thursday, 6:30. Weaker Chinese demand for Australian raw materials continues to weigh on commodity prices. The August release came in at -20.9%. Another sharp decline is expected in the September reading.

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AUD/USD drops, re-approaches 6-year lows

The Australian dollar dropped against its U.S. counterpart on Tuesday, re-approaching a six-year low as global growth concerns continued to weigh on sentiment and as expectations for a U.S. rate hike in the coming months supported the greenback.

AUD/USD hit 0.6937 during late Asian trade, the pair's lowest since September 24; the pair subsequently consolidated at 0.6952, declining 0.54%.

The pair was likely to find support at 0.6893, the low of September 7 and a six-year low and resistance at 0.7035, Monday's high.

Market sentiment weakened after International Monetary Fund head Christine Lagarde said in an interview on Monday that the IMF is likely to revise downwards its estimates for global economic growth due to slower expansion in emerging economies.

Meanwhile, demand for the greenback remained supported after New York Federal Reserve Bank President William Dudley said on Monday that the Fed remains on track for a rate hike this year and could move as soon as the upcoming meeting in October.

The comments came after Fed Chair Janet Yellen said last Thursday that the U.S. central bank was likely to raise interest rates in 2015.

The U.S. dollar was als boosted by data on Monday showing that U.S. personal spending rose 0.4% in August, beating expectations for an increase of 0.3%.

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AUD/USD: Aussie Among Top Performers Before China Data

A rebound in commodity prices helped drive gains in the Australian dollar on Wednesday, however, the currency is at risk of losing its recent gains, with two prominent Chinese manufacturing indices likely to shake up commodity currencies on Thursday.

Brent crude futures were trading 0.58% higher at $48.52 per barrel on Wednesday, while WTI futures were up 0.40% at $45.41.

The AUD/USD pair rose 0.57% to $0.7020 on Wednesday afternoon in New York from $0.6981 where the pair closed on Tuesday almost 24 hours ago, hitting an intraday high of $0.7038.

"Currencies had varied performances against the USD, but very much split along risk-sensitive lines. Emerging market currencies outperformed, along with AUD and NZD," BNZ currency strategist Raiko Shareef noted on Thursday.

The New Zealand dollar was the best performer among the majors on Wednesday, rising more than 80 pips to $0.6397 against the US dollar in afternoon trade in New York, but briefly climbing above $0.64 earlier in the session.

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Aussie gains after retail sales data, focus shifts to U.S. jobs

The Aussie gained on Friday in Asia as retail sales came in as expected while the yen traded flat after upbeat household spending data offset a weaker than expected jobs report.

USD/JPY changed hands at 119.91, down 0.01%, while AUD/USD traded at 0.7047, up 0.24%.

Investors were turning their attention to Friday’s U.S. jobs report for September, which could help to provide clarity on the likelihood of a near-term interest rate hike by the Federal Reserve.

China's markets are closed for the National Day holidays and will re-open on Oct. 8.

In Japan, the August unemployment rate ticked up to 3.4%, from an expected steady 3.3%, while household spending jumped 2.9%, compared to a gain of 0.4% on year in real terms, the first rise in three months.

As well, the BoJ's September corporate inflation outlook said firms see a rise of 1.2% in CPI in one year,and a 1.4% gain in three years.

In Australia the August retail sales figures howed a 0.4% gain as expected.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.13% to 96.22.

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AUD/USD unable to ride the nightmare NFP – slides towards 0.70

The US released a terrible jobs report: only 142K jobs gained on top of weaker gains beforehand and no advance in wages. It was way below expectations and the US dollar suffered across the board.

However, this didn’t persist against the Australian dollar.

AUD/USD made a move to 0.7065, but that was it. From there it changed course and fell to a low of 0.7002. Why can’t the Aussie ride against the soft greenback?

The reason lies in the Aussie’s role as a risk currency: if the US cannot lead the world to stronger growth, how can Australia? Well, Australia depends on China more than any other country, but also the world’s No. 2 economy is not doing so well.

In addition, if the Fed doesn’t hike as a result of this bad report (and other unimpressive data) we could see and commodity prices continue crashing, the Australian dollar should be weaker.

The RBA has linked between the exchange rate and commodity prices. If the Aussie doesn’t fall on its own due to China, the US and commodity prices, it could get a helping hand from the RBA.

Glenn Stevens and his colleagues convene on Tuesday, October 6th, to make their monthly decision. Will they cut the interest rate? Perhaps not too soon, but they certainly introduce a verbal intervention to weaken the A$.

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Thank you for the analysis.

 

Australia: AIG Performance of Services index for September 52.3 (prior 55.6)

AIG Performance of Services index for September

  • Services PMI down for the month to 52.3, from 55.6 in August

Last week we got the manufacturing PMI for Australia, a 3rd consecutive expansion

 

The Aussie $ marches on after RBA hold rates

The RBA kept interest rates on hold as widely expected and the AUD relief rally continues

AUDUSD now broken up through 0.7120 offers/res but stalling at the next tranche at 0.7135. More nearby into 07150.

AUDNZD has posted 1.0976 before retreating shy of the 4 Oct 1.1004 high with traders cautious on the GDT auction later and Fonterra's bullish view of the TPP agreement on NZ dairy market

GBPAUD and EURAUD are both still near session lows of 2.1250 and 1.5666 in a continuation of recent trend

TD Securities are the latest to rule out RBA cuts anytime soon

Expect AUD to remain underpinned but bulls may have to be patient on further gains for the moment

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AUD/USD: Aussie Keeps Gains as RBA Leaves Policy Intact

The Australian currency kept earlier gains and remained above the $0.71 threshold following the latest decision by the Reserve Bank of Australia to hold the benchmark interest rate at 2%.

The so-called aussie rose 0.48% and traded at $0.7114 against the US dollar, retreating only slightly from the intraday high of $0.7134 hit earlier in the session.

The Reserve Bank of Australia (RBA) kept its borrowing costs unchanged at their record low of 2% and said it would keep monetary policy accommodative.

“The board today judged that leaving the cash rate unchanged was appropriate at this meeting,” RBA governor Glenn Stevens said in a statement.

He also pointed to some further softening in conditions in China and East Asia but said that growth in the world's largest economy, the US, remains strong.

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Australia: AiG Construction PMI for September: 51.9 (prior 53.8)

Australia - AiG Performance of Construction Index for SeptemberLike the services PMI from AiG we got a couple of days ago, a decline for the Construction PMI. From 53.8 in August to 51.9 in September.

AiG's 'key findings':

  • The national construction industry expanded for a second consecutive month in September
  • Across the four sub-sectors in the Australian PCI, apartment building activity again expanded solidly and at a rate that was the strongest in the past 13 months
  • House building activity also continued to expand with its rate of growth at an 11-month high in September
  • In contrast, engineering construction activity fell further into negative territory in response to the on-going decline in mining-related investment. The sector's activity sub-index contracted for a fifteenth consecutive month and at the steepest pace since mid-2014. Commercial construction also declined, although conditions in this sector were close to stabilisation after lifting in August and September saw a further expansion of new orders in this sub-sector.
  • Across the construction industry, activity, new orders and employment all lifted in September
  • Despite the slower rate of growth in September, residential builders were generally positive in their assessment of business conditions citing low interest rates and the release of land for new housing developments as key factors supporting activity
  • However, on a broader industry front, respondents to the Australian PCI pointed to on-going pressures arising from subdued private sector investment, a highly competitive pricing environment and tight margins.
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