Compass Global Markets' Blog

Market Update - 31st January 2019 - AUD & Equities Surge On Fed Slow Down

Posted by Patrick Downes on January 31, 2019 at 9:21 AM

Please note that the commentary below is factual information provided to a group of readers as a web blog, and where an opinion is expressed by the author, it is GENERAL ADVICE only.

AUD Surges:

A double whammy of better than anticipated local CPI numbers and a more patient U.S Federal Reserve has helped the AUD surge higher against all the majors. AUD/USD moved back above 0.7200 and earlier this morning reached it's highest level since early December. The AUD also performed quite strongly vs. the Japanese Yen as risk aversion dissipated - both JPY and USD are both typically seen as risk aversion metrics rising when sentiment is poor and falling when sentiment is strong. Overall the past 24 hours have been good for the Aussie Dollar and equities for that matter with the Nasdaq moving 2.2% higher while the Dow surged a comfortable 1.77%. Our local index should open around 0.6% higher but may do even better through the session.

More Local Data: 

Import prices and Private Sector Credit are both due out this morning followed by Chinese manufacturing PMI around midday. Import prices will likely rise given the fall in the AUD, while private sector credit is expected to remain rather sluggish around 0.3% growth for the month. Commodities prices have been performing well lately, however we did see a slight pullback overnight in the price of iron ore following a pretty bullish run on the back of this second tragic Vale tailings dam failure.

AUD EXCHANGE RATES:

AUD/USD – 0.7216

AUD/GBP – 0.5503

AUD/EUR – 0.6281

AUD/NZD – 1.0475

AUD/JPY – 78.701

USD/BTC – $3,413

OTHER MARKETS:

All Ords (XAO) – 5,951

Gold – A$1,820/oz

Silver –  A$22.16/oz

WTI – US$54.29/barrel

DATA RELEASES TODAY:

AUD – Import Prices & Private Sector Credit at 11.30am

CNY - Manufacturing PMI at Midday


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Patrick Downes

Senior Corporate FX Dealer

Phone Patrick - 0431 278 632 

  Email Patrick: patrick@compassmarkets.com

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 DISCLOSURE AND DISCLAIMER - GENERAL ADVICE WARNING
The information provided in this report has been prepared without taking into account your particular objectives, financial situation or needs. You should consider whether our products are appropriate for you and read the FSG and PDS which are available on this website.
This report and must not be copied, either in whole or in part, or distributed to any other person.
All references to prices, amounts and currency are in Australian dollars unless otherwise noted.
This report is provided for Australian residents only and is not intended for use by residents of any other country.

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