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.
DATA RELEASES TODAY:
AUD – Trade Balance at 11.30am
GBP – Services PMI at 8.30pm
GBP - Official Bank Rate decision at 11.00pm
AUD EXCHANGE RATES:
AUD/USD – 0.7642
AUD/GBP – 0.6201
AUD/EUR – 0.6885
AUD/NZD – 1.0512
AUD/JPY – 78.85
***Above rates are indicative wholesale rates and intended as a guide only***
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Senior Corporate FX Dealer
Phone Patrick - +61 03 9099 8459