Compass Global Markets' Blog

Market Update - 21st June 2017 - Aussie Drifts Lower On Weaker Metals Prices And Weaker Investor Sentiment

Posted by Patrick Downes on June 21, 2017 at 8:32 AM

The Aussie dollar has corrected somewhat overnight thanks to another dip in iron ore prices and generally weaker investor sentiment across the board. AUD/USD is back below 0.7600 as I suspected could be the case (on Monday) given considerable resistance around the 0.7600 figure.

Little economic data was released yesterday and very little is due out today again; as such you'd have to suspect that the Aussie will either bubble away at current levels or drift lower still. Either/or it could be a good time to look at hedging future USD exposures particularly given how poorly the Aussie has performed when at or around the 0.7600 figure. Call me to discuss options to take advantage of the Aussie at current levels - 0431 278 632.

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CGM Weekly FX Video Update - 20th June 2017

Posted by Thomas Su on June 20, 2017 at 12:35 PM

 

 

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Market Update - 19th June 2017 - Aussie Surges Past 0.7600 But Will It Hold?

Posted by Patrick Downes on June 19, 2017 at 9:24 AM

A raft of poor economic data out of the U.S last week has helped the so called Aussie reach its highest levels in just over two months vs. the Greenback, closing just above 0.7600. The last time AUD/USD was around these levels was back on April 18th where it briefly topped 0.7600 before capitulating back to the low 0.7300's. Where AUD/USD heads from here is anyone's guess, particularly given the very uncertain and sea sawing economic data recently out of both Australia and the U.S.

The Aussie dollar has also performed quite well against the EURO and GBP of late thanks to being I guess the cleanest dirty shirt in the laundry. The U.K and Europe with recent elections and economic uncertainty along with heightened terrorism risks have all benefited the Aussie dollar crosses.

No really important economic data or announcements are happening today or this evening, so we should therefore see the Aussie maintain current levels.

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CGM's Latest Interview on CNBC with Tony Boyadjian

Posted by Thomas Su on June 15, 2017 at 10:40 AM

 

Link:  http://video.cnbc.com/gallery/?video=3000626729

Why the British Pound could be headed lower.

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Market Update - 15th June 2017 - Aussie Higher As Poorer U.S Economic Data Weighs On Greenback

Posted by Patrick Downes on June 15, 2017 at 8:38 AM

The U.S Federal Reserve raised their official interest rates overnight by a further 25 basis points marking the third such rise since the December meeting of last year. The new official interest rate is now 1.25%, just 25 basis points shy of Australia's cash rate at 1.5%. Markets are still anticipating further rate hikes from the U.S Federal Reserve, however these bets may have been trimmed overnight given the release of poorer than expected retail sales and CPI figures which actually turned negative. Whether this is a blip on the radar or something more sinister is still unknown but it appears the Federal Reserve seem hell bent on raising rates regardless of the data - perhaps so they have ammunition in the form of rate cuts should U.S asset prices (namely stocks) see a strong correction at some point in the next 6-12 months.

Ahead today is local employment figures and the unemployment rate, both due around 11.30am. The market is expecting to see around 10K new jobs created but no change to the unemployment rate from 5.7%. As has been the case lately economists and traders alike will need to sort through the data to determine the make up of the employment number, specifically the ratio of full-time to part-time jobs. Full time jobs tend to have a greater positive impact on the Aussie dollar.

For those watching the GBP: we've had a strong run up following the U.K elections with GBP now hovering around the low 0.59's vs. the Aussie, but with the Bank of England (BOE)meeting to determine interest rates tonight this momentum may shift. Whilst the market is not expecting any cut to U.K interest rates from 0.25% all eyes will be on the monetary policy statement and any next steps from the BOE to support the Pound.

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Market Update - 14th June 2017 - GBP Surges On Strong Economic Data, U.S Fed Tipped To Hike Rates Again

Posted by Patrick Downes on June 14, 2017 at 8:30 AM

The big mover overnight was the GBP with the Pound recovering from recent falls to the tune of around 1.5% thanks to improved economic data released overnight. The data suggested strong core growth in everything from consumer prices and retail prices to even house prices which surged to an annualised growth rate of 5.6%. AUD/GBP as a result is also 1.5% lower or thereabouts and remains in what appears to be a bearish down trend. Time will tell if this continues however those clients with GBP exposures should monitor closely.

We have a ton of data out over the next 24 hours with local consumer sentiment figures released by Westpac at 10.30pm. This data is closely followed by Chinese industrial production numbers which have been on the improve lately. The big data release/announcement however is of course U.S CPI and Retail Sales figures along with the latest rate adjustment from the U.S Federal Reserve. Fed Chairwomen Janet Yellen is widely tipped to raise rates by 25 basis points once again which would take the U.S Fed Funds Rate to 1.25% just 25 basis points shy of the Aussie Cash Rate. Despite the move being priced into the market we should still see a bounce in the USD if the U.S Fed do indeed raise rates. This all happens at 4.00am AEST.

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CGM Weekly FX Video Update - 13th June 2017

Posted by Thomas Su on June 13, 2017 at 11:31 AM

 

 

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Market Update - 13th June 2017 - Winter In Full Swing But Aussie Stalling Again Around 0.7500 vs the Greenback

Posted by Patrick Downes on June 13, 2017 at 8:38 AM

I hope you all enjoyed the Queens Birthday long weekend. For me it was all about family and food with a trip down to the very chilly Phillip Island; in fact we actually had a swim with the water temperature around 15 degrees Celsius. Invigorating to say the least.

On to the matter of markets and Tuesday morning sees AUD steady against the USD but sharply higher against the GBP (compared to last Thursday) as a result of a less than impressive hung parliament in the U.K. The hung parliament will no doubt make Theresa May's Brexit negotiations just that little bit tougher and hence the GBP is again out of favour.

Other than that, iron ore prices remain around 420 Yuan a tonne or in the mid $50's a tonne vs the Greenback. The Aussie probably needs another strong bounce in commodities if it's to push much higher and it's anyone's guess as to if or even when this recovery in commodity prices will take place, but looking at 2016, the second half was certainly good for commodities prices.

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ABC Breakfast News - Finance Featuring Tony Boyadjian

Posted by Thomas Su on June 9, 2017 at 10:28 AM

 

 

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Market Update - 8th June 2017 - UK Elections Could Throw Up Another 'Brexit' Style Event

Posted by Patrick Downes on June 8, 2017 at 8:38 AM

Aussie GDP figures came in on expectations yesterday and resulted in a nice little jump higher for the Aussie dollar particularly against the EURO and USD. The sharp move higher on the announcement at 11.30am was probably as a result of quite a few economists and traders going into the data announcement quite bearish with fears we might see another contraction in GDP. However that obviously didn't eventuate and traders were forced to quickly cut their short positions (were by a trader is selling AUD and buying a foreign currency).

Ahead today is more local economic data - this time Aussie trade balance figures and Chinese trade balance figures due for release around the middle of the day. However the big likely market mover is U.K elections tonight, with incumbent Theresa May taking on Jeremy Corbyn and a raft of also-ran's. What makes this election so important is because it really does throw Brexit up in the air once again if Corbyn topples May. Tonight could certainly be another Brexit type event should May lose, but we'll have to wait and see. I suspect we'll have an answer by tomorrow afternoon.

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