Compass Global Markets' Blog

21th February 2017 - Weekly Currency Market Report.

Posted by Thomas Su on February 21, 2017 at 10:06 AM


The Market in Brief:

                                                      • AUD down against the majors except EUR and GBP.
                                                      • AUD hits multi month and multi year highs V majors.
                                                      • AUD unemployment rate down from 5.8% to 5.7% and jobs +13,500 V expected +9,700
                                                      • All U.S. data above expectations.
                                                      • U.K.  data mixed.

Market Events Due:

                                                  • NZD PPI Input q/q (Mon) GDT Price Index (Wed)
                                                  • RBA Monetary Policy Meeting Minutes (Tue) Governor Lowe speaks (Wed) Privat Capex q/q (Thur) Governor Lowe speaks (Fri)
                                                  • GBP Second Estimate GDP q/q (Wed)
                                                  • CAD Core Retail Sales m/m (Thur) CPI m/m (Sat)
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Market Update - 21st February 2017 - Iron Ore Prices Surge Past US$90 A Tonne Supporting AUD Crosses & Government Coffers

Posted by Patrick Downes on February 21, 2017 at 9:55 AM

Good morning all. Without wanting to sound like a broken record the Aussie dollar is once again little changed overnight. In fact the three majors AUD/USD, AUD/EUR and AUD/GBP are all within about 10-20 points of where they were trading this time yesterday morning. Commodities markets were mixed while iron ore continued to push higher with the latest move pushing iron ore prices past US$90 a tonne which explains the Aussie dollars resilience of late. Recent comments from the likes of Deutsche Bank suggest the Aussie may still have room to move higher, but that is certainly pure unadulterated speculation.

Things will likely get a little busier today with the release of the latest monetary policy minutes from the Reserve Bank of Australia (RBA) at 11.30am this morning. While we're not expecting to see anything out of the ordinary in the RBAs most recent minutes release certainly any change in rhetoric will be duly noted and could result in a sharp move in the Aussie if either overly bearish (negative) or bullish (positive). Other than that U.K inflation hearings are held again tonight which will give us a better insight into the health of the U.K economy - those watching AUD/GBP might want to jump on Bloomberg around 9.00pm tonight to follow the action.

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Topics: Report, Market

Market Update - 20th February 2017 - AUD/USD Does Nothing For A Second Week

Posted by Patrick Downes on February 20, 2017 at 9:54 AM

The Aussie dollar finished the week barely changed versus the Greenback, extending to two weeks the period in which AUD/USD has done literally nothing. AUD/EUR and AUD/GBP however have continued to make strides, with Aussie above 0.7200 vs. the EURO and above 0.6100 vs. the GBP - and this trend doesn't look set to change anytime soon.

In the absence of any economic data global equities rounded out last week very much mixed with the U.S Dow and German DAX flat, while the tech heavy NASDAQ and and U.K FTSE added around 0.4% and 0.3% respectively.

A bit of Aussie data is due out this week but other than that, its relatively quiet from a data perspective. It's a U.S bank holiday tonight, so expect a one day delay for all USD payments. These will be sent tomorrow evening.

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Topics: Report, Market

Market Update - 17th February 2017 - Aussie Retreats As Local Employment Data Not All Rosy

Posted by Patrick Downes on February 17, 2017 at 9:28 AM

European and U.S equities finished mostly lower in overnight trade with the French CAC and Euro Stoxx 50 the worst performers down by about 0.4%. Commodities markets also retreated however iron ore has continued to buck the trend and remains in pretty good shape near US$90 a tonne. Not surprisingly we saw Gold and Silver rally as equities and the risk averse Aussie dollar fell.

Local employment numbers which were released yesterday morning remain positive with about 13,500 new jobs created which helped push the unemployment rate back to 5.7%. But if we dig a little deeper the data shows that many of the jobs created recently continue to be part-time jobs as opposed to full-time jobs, and while this seems like a neither here nor there argument with a job being a job markets do prefer to see full time employment as opposed to short-term part-time positions. As such AUD/USD has fallen over the past 24 hours.

Nothing much due out today but we will see UK retail sales later tonight.

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Topics: Report, Market

14th February 2017 - Weekly Currency Market Report.

Posted by Thomas Su on February 14, 2017 at 10:17 AM


The Market in Brief:

                                                    • AUD up against the majors and flat V USD and GBP
                                                    • RBA leaves cash rate at 1.5% as expected while Retail Sales print -0.1% V expected +0.3%.
                                                    • RBNZ leaves cash rate at 1.75% as expected.
                                                    • U.S. data mixed.
                                                    • U.K data prints above expectations
                                                    • CAD data prints below expectations

Market Events Due:

                                                • CNY CPI and PPI (Tue)
                                                • AUD Employment Change and Unemployment Rate (Thur)
                                                • USD PPI m/m and Fed Chair Yellen speaks (Wed) CPI and Retail Sales (Thur) Building Permits and Philly Fed Manufacturing Index (Fri)
                                                • EUR German Prelim GDP q/q
                                                • U.K. CPI y/y (Tue) Retail Sales (Fri)
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7th February 2017: RBA Announcement Cash Rate unchanged at 1.50 per cent

Posted by Thomas Su on February 7, 2017 at 2:31 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.

Conditions in the global economy have improved over recent months. Business and consumer confidence have both picked up. Above-trend growth is expected in a number of advanced economies, although uncertainties remain. In China, growth was stronger over the second half of 2016, supported by higher spending on infrastructure and property construction. This composition of growth and the rapid increase in borrowing mean that the medium-term risks to Chinese growth remain. The improvement in the global economy has contributed to higher commodity prices, which are providing a boost to Australia's national income.

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7th February 2017 - Weekly Currency Market Report.

Posted by Thomas Su on February 7, 2017 at 10:36 AM


The Market in Brief:

                                                  • AUD up against the majors except JPY.
                                                  • AUD record trade surplus surprises market
                                                  • BoE ups growth & lowers inflation forecasts
                                                  • BoJ denies intervention but doesn’t rule it out
                                                  • FOMC on track to hike
                                                  • US Unemployment ticks higher

Market Events Due:

                                              • NZ inflation expectations (Tue)
                                              • AUD RBA cash rate (Tue) RBA's Lowe speaks (Thur) Monetary Policy Statement (Fri)
                                              • NZ global dairy prices (Wed) 
                                              • RBNZ cash rate and Monetary Policy Statement (Thu) 
                                              • Chinese trade balance (Fri)
                                              • UK Manufacturing (Fri)
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Market Update - 2nd February 2017 - US Fed Leave Rates Unchanged But Reiterate U.S Economy On Track

Posted by Patrick Downes on February 2, 2017 at 8:49 AM

The latest from the U.S Federal Reserve suggests further rate hikes remain likely in 2017 despite no change overnight and as the economy continues its long winded recovery. Inflation has continued to increase over the past 6 months, however it is still below their target of 2%. Overall the rhetoric from the Federal Reserve was positive and in conjunction with another lift in ADP jobs growth overnight helped push the US Dollar and U.S equities marginally higher.

The AUD remains in the 0.75's vs. the USD, 70's vs. the EUR and 59's vs. the GBP with no local data due out today or tomorrow. The Bank of England decides on interest rates tonight with forecasts suggesting no change to interest rates from 0.25%.

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Topics: Report, Market

Market Update - 1st February 2017 - Equities Slip Again But Aussie Dollar & Commodities Still Strong Ahead Of FOMC

Posted by Patrick Downes on February 1, 2017 at 8:36 AM

It appears the honeymoon may be over for the Trump administration, with consumer confidence taking a dip in the latest reading, while the previous months reading was also revised lower. Trumps use of executive orders has clearly created a storm and that storm has resulted in now two solid down days in a row for both local and U.S equities. The Dow Jones finished down half a percent while our local market got spanked to the tune of another 0.8%.

Commodities and the Aussie dollar however continue to weather the storm and are holding up quite nicely perhaps in lingering response to hope that Trump will push ahead with his $1trillion+ infrastructure plans for the U.S economy.

AUD/USD may test 0.7600 today or tonight - a level it has tested twice already this month and failed to pass - as we see Chinese manufacturing data around lunchtime followed by U.S ADP preliminary jobs numbers and the latest from the U.S Federal Reserve around 6.00am tomorrow morning. They are not tipped to change rates from 0.75%, however anything is possible and all traders will be watching the markets closely early tomorrow morning.

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Topics: Report, Market

Market Update - 31st January 2017 - Equity Markets Take Stumble After Volatile Weekend

Posted by Patrick Downes on January 31, 2017 at 8:33 AM

Not surprisingly equities took a big stumble yesterday falling by nearly 1% locally while U.S stocks were down by as much as 0.83% at close of trade. The tech heavy Nasdaq was the worst performer followed by the Dow Jones which fell back below the key 20,000 level.

AUD and it's various crosses remain in pretty good shape as the U.S dollar and other currencies treads water. AUD/USD actually hasn't done a great deal since the 12th of January, which followed a nearly two week surge higher where we saw the currency pair rally from 0.7160 on Jan 3 to just on 0.7500.

Another quiet day ahead for markets, with only Bank of Japan monetary policy stuff on the agenda where they're unlikely to move rates from -0.1%. U.S consumer confidence figures are due at 2.00am and this is where it gets interesting. CB Consumer confidence had rallied in the wake of the Trump presidency but it'll be interesting to see if this honeymoon is over.


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Topics: Report, Market