Compass Global Markets' Blog

6th December 2016: RBA Announcement Cash Rate unchanged at 1.50 per cent

Posted by Thomas Su on December 6, 2016 at 2:30 PM

Statement by Philip Lowe, Governor: Monetary Policy Decision

 At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 per cent.

The global economy is continuing to grow, at a lower than average pace. Labour market conditions in the advanced economies have improved over the past year. Economic conditions in China have steadied, supported by growth in infrastructure and property construction, although medium-term risks to growth remain. Inflation remains below most central banks’ targets, although headline inflation rates have increased recently. Globally, the outlook for inflation is more balanced than it has been for some time.

Commodity prices have risen over the course of this year, reflecting both stronger demand and cut-backs in supply in some countries. The higher commodity prices have supported a rise in Australia’s terms of trade, although they remain much lower than they have been in recent years. The higher prices are providing a boost to national income.

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5th December 2016 - Weekly Currency Market Report.

Posted by Thomas Su on December 6, 2016 at 10:24 AM

 

The Market in Brief:

                                          • AUD up against the USD and JPY and flat V CHF.
                                          • AUD down against EUR, GBP, CAD and NZD.
                                          • AUD posts fresh 7 month high against JPY
                                          • USD NFP 178k V expected 177k Unemployment Rate 4.6% V expected 4.9%

Market Events Due:

                                        • GBP Services PMI (Mon) Manufacturing Production (Wed)
                                        • AUD Cash Rate and RBA Statement (Tue) GDP q/q (Wed)
                                        • USD ISM Non-Manufacturing PMI (Tue) Prelim UoM Consumer Sentiment(Sat)
                                        • CNY Trade Balance (Thur)
                                        • EUR ECB Press Conference (Fri)
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28th November 2016 - Weekly Currency Market Report.

Posted by Thomas Su on November 29, 2016 at 10:12 AM

 

The Market in Brief:

                                        • AUD up against the majors
                                        • AUDJPY at a fresh 7 month high.
                                        • USD Core Durable Goods Orders print +1.0% v expected +0.2%.
                                        • GBP Second Estimate GDP 0.5% as expected.

Market Events Due:

                                      • EUR Draghi speaks (Tue and Wed)
                                      • USD Prelim GDP, CB Consumer Confidence (Wed) ISM Manufacturing (Thur) Non Farm Payrolls and Unemployment Rate (Fri)
                                      • AUD Private Capital Expenditure (Thur) Retail Sales(Fri)
                                      • GBP Bank Stress Test Results (Wed) Manufacturing PMI (Thur)
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21st November 2016 - Weekly Currency Market Report.

Posted by Thomas Su on November 21, 2016 at 11:18 PM

 

The Market in Brief:

                                      • AUD down against the majors with the exception of JPY.
                                      • US rate hike of 0.25% fully priced in for 15 Dec 2016.
                                      • USD index, DXY has risen for 10 consecutive days to a 14 year high. 
                                      Majority of US data printing above expectations.

Market Events Due:

                                    • EUR Draghi speaks (Tue) German Ifo Business Climate (Thur) 
                                    • USD Core Durable Goods Orders m/m, Unemployment Claims, FOMC Meeting Minutes
                                    GBP Second Estimate GDP q/q (Fri)
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Market Update - 15th November 2016 - AUD Remains In Strong Position Thanks To Rebounding Commodities

Posted by Patrick Downes on November 15, 2016 at 9:17 AM

Markets have remained relativiely range bound so far this week in the absence of any news or economic announcments, however it all picks up pace again today and this evening with a raft of data due out. Local monetary policy minutes kickstart the day at 11.30am, followed by German GDP at 6.00pm this evening and then U.K CPI and US retail sales.

Commoditiy prices - something I haven't spoken about for a little while - have also rebounded of late, with the star performers being coal, iron ore and copper. Precious metals such as Gold have however fallen as market risks have resided following infrastructure optimism surrounding Drumpfs election as the next U.S President. Strong commoditiy prices are probably one of the reasons the Aussie has remained resilient as our economy relies heavily on the above mentioned commodities which have recently strongly rebounded.

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Market Update - 11th November 2016 - Markets Reasonable Stable 2 Days After U.S Elections

Posted by Patrick Downes on November 11, 2016 at 8:30 AM

Markets are looking reasonably healthy going into the last day of the week with AUD/USD just holding above 0.7600 while commodities and equities have continued to rebound following initial falls after the U.S Presidential election.

Little data is due out today but we do have U.S conumer sentiment numbers at 2am. I'm not sure when these sentiment figures are gathered but assuming it's happened after the Presidential election on Tuesday then we should see a clear indication on what consumers think about the election of The Donald to the highest level of office.

Other than that I hope you've all had an eventful and enjoyable week and I'll be getting in touch with a lot of my existing clients over the next little while with the hope of meeting any of you who I havn't yet had a formal face to face meeting.

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Market Update - 10th November 2016 - Markets Get Mauled On Trump Presidency But Have Rebounded Overnight

Posted by Patrick Downes on November 10, 2016 at 9:03 AM

Well what seemed entirely impossible only a week or so ago is now well and truly a reality. Donald Drumpf is the President-elect of the United States of America with the extremely right-wing Pence as V.P. Initially markets tanked quite dramatically, with the Aussie share market losing about 3% while U.S stock futures plummeted as much as 5%. Gold soared as did the Japanese Yen with investors moving their money into safe haven assets. It was certainly a dark day not only for America and American politics but also Western progress.

Markets however have staged a pretty remarkable rebound overnight as Drumpf changed his tone to a more inclusive less abrasive one. Gold and JPY returned to yesterday morning's levels while the Aussie stock market looks set to rebound strongly by as much as 3.5%.

Obviosuly it's not a simple task to determine the future but quite often clients do expect us to be able to predict things which havn't yet happened. All I can say today is that the volatility is probably not over and so given the Aussie is still range trading and at the moment near the top of recent ranges for EUR, GBP and USD you might want to take risk off the table by booking spot payments or Forwards for future exposures. I find it hard to see a Drumpf presidency without scandal and turmoil, and markets don't like these sorts of things.

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Market Update - 9th November 2016 - U.S Voting Concludes, AUD/USD Up As Markets Bet On Clinton Win

Posted by Patrick Downes on November 9, 2016 at 8:20 AM

Voting has concluded in the U.S for the next President of the U.S and whether its a Clinton or Drumpf victory the liklihood is that we're going to see Brexit type volatility when counting begins and numbers start to filter through to markets, likely during today. At present it looks like markets are pricing in a Hilary Clinton win with risk assets like equities and the Aussie dollar all rallying while traditional safe havens in Gold, JPY and the Greenback have eased in the past few days.

Thankfully there is little other economic data on the cards today, so all eyes will certainly be on Bloomberg and the other major business and news sites to try and determine the next U.S President. Other than that there's little more I can add so please if you have any requirement for pricing of spot or Forwards please keep in mind any pricing will have a quick expiry particulalry if markets start swinging around violently.

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7th November 2016 - Weekly Currency Market Report.

Posted by Thomas Su on November 8, 2016 at 8:12 AM

 

The Market in Brief:

                                    • AUD up V USD and CAD, down V EUR, GBP, JPY, NZD and CHF.
                                    • RBA leaves cash rate at 1.5% as expected.
                                    • Fed leaves rates on hold as expected. NFP print 161k V expected 174K with unemployment steady at 4.9%. 
                                    GBP Construction PMI and Services PMI print above expectations.

Market Events Due:

                                  • CNY Trade Balance (Tue)
                                  • GBP Manufacturing Production (Tue) 
                                  • USD Presidential Election (Wed) Unemployment Claims (Fri) Prelim UoM Consumer Sentiment (Sat)
                                  NZD Official Cash Rate RBNZ Rate Statement
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Market Update - 3rd November 2016 - Stocks/Commodities On Back Foot, While UK Courts Rule On Brexit Legality

Posted by Patrick Downes on November 3, 2016 at 8:38 AM

I hope everyone enjoyed their respective weekends/long weekend and of course backed a few winners at Flemington yesterday.

Commodities and stocks took a dip overnight amid widespread risk aversion in the lead up to the U.S Presidential election which is due to take place next Tuesday night our time. With polls tighetening and subsequent renewed risk aversion, markets are suggesting that a Drumpf win will be a negative for stocks and commodities, while a Clinton win will be business as usual hence AUD/USD which is classed as a risk asset (moving up when times are good and down when times are bad) you'd have to expect that a solid Clinton/Democrat win next Tuesday night will result in a little uptick in AUD/USD, perhaps again testing the seemingly unbreakable 0.7700 figure.

Overnight U.S preliminary jobs numbers went backwards marginally but had little impact on the AUD/USD cross which is remaining range bound between 0.7400-0.7650. AUD/EUR and AUD/GBP remain solid buying at current levels but a key vote on the legality of the U.K to leave the EU is due to be ruled upon tonight around 9.00pm. This could have a dramatic impact on AUD/GBP, so those wishing to avoid risk should buy GBP today.

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