Chinese manufacturing and non-manufacturing PMI numbers released yesterday morning provided a very short lived boost for commodities and the Aussie dollar with the pair since falling and are mostly lower this morning. The reason for the the half percent drop or so in the Aussie dollar across the board stems from generally lower risk appetite around the globe but also a more than 6% drubbing in iron ore prices which are now dwindling under US$60 a tonne. Trying to determine why iron ore prices are so volatile is a fools game and hence all I can say is expect the unexpected with regards to future moves in iron ore prices; iron ore per tonne has now drifted between US$40 a tonne all the way up to the mid US$90's a tonne only to fall back to around the mid $US50's this morning.
More local Aussie data is due out today with private capital expenditure and retail sales released around 11.30am. With the Aussie under pressure this morning, one would suggest a poor retail sales figure could see the Aussie dollar much lower, potentially in the low 0.73's, while a strong figure should see us testing 0.7500 again in the short term. ADP preliminary U.S jobs numbers are released tonight along with ISM manufacturing PMI - a key leading indicator of economic health in the U.S. All-in-all a busy 24 hours ahead for the Aussie dollar.
DATA RELEASES TODAY:
AUD - Private Cap. Expenditure and Retail Sales at 11.30am
USD - ADP Prelim. Jobs Numbers at 10.15pm
USD - ISM Manufacturing PMI at midnight AEST
AUD EXCHANGE RATES:
AUD/USD – 0.7394
AUD/GBP – 0.5736
AUD/EUR – 0.6561
AUD/NZD – 1.0457
AUD/JPY – 81.978
***Above rates are indicative wholesale rates and intended as a guide only***
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