Compass Global Markets' Blog

Market Update - 7th March 2018 - AUD/USD Moves Higher Despite Continued Weak Retail Sales

Posted by Patrick Downes on March 7, 2018 at 9:49 AM

Despite weaker than expected retail sales figures yesterday and a more bearish than anticipated RBA the Aussie Dollar has managed to move higher against the USD, Pound & Euro overnight. The RBA left rates on hold again noting inflation remains below their target and that current interest rates are helping to support the local economy. However there is clearly still work to be done given that retail sales figures came in pretty poor yesterday morning.

Commodity markets were mixed overnight with oil moving higher along with iron ore whilst zinc, copper and the other bass metals were reasonably flat. US equities were generally higher with the best performing index being the NASDAQ up about half a percent, while the Dow was up only a fraction of a percent.

We have more local economic data out today with quarterly GDP figures due at 11:30 a.m. The market is expecting to see around half percent growth in GDP which will obviously be eagerly anticipated buy not only market participants but also the RBA. Later this evening we will see preliminary US ADP non farm payrolls figures which are anticipated to come in around 194,000 new jobs. This figure is released ahead of the official Government number released Friday evening and can therefore result in movements in the USD as the ADP figure usually matches up pretty well with the official non-farm government figure.


AUD/USD – 0.7824

AUD/GBP – 0.5632

AUD/EUR – 0.6306

AUD/NZD – 1.0726

AUD/JPY – 83.067

USD/BTC – $10,769


Gold – A$1704/oz

Silver –  A$21.40/oz

WTI – US$62.22/barrel


AUD - Quarterly GDP at 11.30am

USD – ADP Non-Farm Payrolls at 12.15am

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Topics: Report, Market

6th March 2018: RBA Announcement Cash Rate unchanged at 1.50 per cent.

Posted by Thomas Su on March 6, 2018 at 3:16 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.

The global economy has strengthened over the past year. A number of advanced economies are growing at an above-trend rate and unemployment rates are low. Growth picked up in the Asian economies in 2017, partly supported by increased international trade. The Chinese economy continues to grow solidly, with the authorities paying increased attention to the risks in the financial sector and the sustainability of growth.

The pick-up in the global economy has contributed to a rise in oil and other commodity prices over the past year. Even so, Australia's terms of trade are expected to decline over the next few years, but remain at a relatively high level.

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CGM Weekly FX Video Update - 6th March 2018

Posted by Thomas Su on March 6, 2018 at 3:15 PM


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Topics: Business, Currency, Report, Market

Market Update - 5th March 2018 - AUD & Markets Finish The Week Flat

Posted by Patrick Downes on March 5, 2018 at 8:43 AM

The Aussie dollar is little changed since Friday morning while equities and commodities finished slightly ahead over the weekend. Markets remain volatile though with Trump's tariffs weighing on investor sentiment until some clarity is provided with respect to what the tariffs may be, in what form and applied to what markets.

No local economic data is out today however later this evening we'll see the release of UK Services PMI and US Non-Manufacturing data. Locally the data kicks off tomorrow with retail sales and the RBA cash rate decision at 11.30am and 2.30pm respectively. Goes without saying retail sales and interest rates are key to the Aussie's directions and markets will be on high alert tomorrow between 11-3 AEST.


AUD/USD – 0.7772

AUD/GBP – 0.5625

AUD/EUR – 0.6293

AUD/NZD – 1.0715

AUD/JPY – 81.948

USD/BTC – $11,477


Gold – A$1701/oz

Silver –  A$21.25/oz

WTI – US$61.35/barrel


GBP – Services PMI at 8.30pm

USD - ISM Non-Manufacturing PMI at 2.00am

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Topics: Report, Market

Market Update - 2nd March 2018 - Markets Sent Into A Tail Spin As Trump Talks Tariffs & Trade Wars

Posted by Patrick Downes on March 2, 2018 at 8:32 AM

Donald Trump rattled markets overnight sending the AUD and commodities lower and equities into a tailspin which erased about 1-1.5% from U.S and European indices. His latest hair brained plan is to impose huge tariffs on steel and aluminium coming into the U.S in a short term bid to boost business confidence (and votes) in the U.S steel and aluminium industries, however the tariffs if imposed are almost certain to trigger a trade war with Europe, China and Canada, the biggest supplier of steel into the U.S. 

Equities look set to open lower again today here in Aus while AUD/EUR has fallen about 40 or so points since yesterday. AUD/EUR is heading towards a critical level around 0.6300 and if this doesnt hold we could well be seeing AUD/EUR test previous lows around 0.6200.


AUD/USD – 0.7757

AUD/GBP – 0.5628

AUD/EUR – 0.6325

AUD/NZD – 1.0695

AUD/JPY – 82.435

USD/BTC – $10,973


Gold – A$1697/oz

Silver –  A$21.26/oz

WTI – US$61.24/barrel


GBP - Prime Minister May Speaks

GBP - Construction PMI at 8.30pm

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Topics: Report, Market

Market Update - 1st March 2018 - AUD/USD Declines For A Second Straight Night On Powell Testimony & Weaker Commodities Prices

Posted by Patrick Downes on March 1, 2018 at 9:16 AM

No report from me yesterday as I had quite a busy morning and was under the pump booking payments and what not.

What you missed was a slump in AUD/USD Wednesday night and unfortunately a further fall in AUD/USD overnight to be below 0.7800 this morning. Comments from Fed Chairman Powell at his inaugural Congressional Testimony suggest as many as 3-4 rate hikes are on the cards in the U.S this year which should support the US Dollar. However what should happen and what does happen is often quite different and that can be seen in AUD/USD at current levels. Strong commodities prices and buoyant demand from China for raw materials is essentially whats keeping the Aussie dollar up - and in my opinion should continue to support the Aussie Dollar. Barring a global meltdown.

However as I've mentioned before there are two camps of thought - one who believe AUD/USD has to go lower as US rates rise and the other who believe AUD/USD can move higher with commodities prices and growth around the world.

AUD/EUR which has been in decline for since Feb 2017 appears to have found support around the mid 0.63's and it did manage to hold this level throughout the whole of February. Where AUD/EUR heads from here is anyones guess but a break below 0.6350 could see AUD/EUR retreat to 0.6200. A break above on perhaps poor European growth figures could see it test 0.6600.


AUD/USD – 0.7760

AUD/GBP – 0.5639

AUD/EUR – 0.6363

AUD/NZD – 1.0763

AUD/JPY – 82.788

USD/BTC – $10,528


Gold – A$1698/oz

Silver –  A$21.15/oz

WTI – US$61.45/barrel


AUD - Private Capital Expenditure at 11.30am

GBP - Manufacturing PMI at 8.30pm

USD - Fed Chairman Powell Testifies (again) at 2.00am (tomorrow morning)

USD - ISM Manufacturing PMI at 2.00am

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Topics: Report, Market

Market Update - 27th February 2018 - Equities & Commodities Post Further Gains, AUD Stable Ahead Of Maiden Powell Testimony

Posted by Patrick Downes on February 27, 2018 at 8:36 AM

Markets continue to recover lost ground leading up to the maiden congressional testimony of incoming Federal Reserve Chairman Jerome Powell. Many believe Powell will provide the markets with some comfort by announcing he'll be comfortable with higher inflation for longer before raising U.S interest rates. U.S equities led by the DOW piled on gains in excess of 1% and have now recovered almost all of the losses during the flash crash earlier this month. Jerome Powell is set to testify to the U.S congress early tomorrow morning and we can expect some increased volatility in forex and equity markets leading up to and during the testimony.

The AUD is reasonably stable thanks to rising commodities prices and iron ore continues to hold in the high US$70's a tonne.


AUD/USD – 0.7853

AUD/GBP – 0.5621

AUD/EUR – 0.6375

AUD/NZD – 1.0732

AUD/JPY – 83.970

USD/BTC – $10,333


Gold – A$1698/oz

Silver –  A$21.21/oz

WTI – US$63.95/barrel


USD - Core Durable Goods Orders at 12.30am

USD - Fed Chair Powell Testifies at 12.30am

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Topics: Report, Market

Market Update - 26th February 2018 - Equities & Commodities Finish Last Week In Positive Territory

Posted by Patrick Downes on February 26, 2018 at 8:29 AM

Not much happened over the weekend in terms of economic data releases however commodities and stocks performed pretty well Friday evening which suggests markets and the Aussie dollar open today in a reasonably buoyant fashion. The Spot Iron Ore price is also holding up nicely and ever so slowly edging towards US$80 a tonne which is certainly bullish for the AUD and the commodities sector in general.

Again its a very quiet start to the week with no economic data released today or overnight. The first bit of local data is released Wednesday where we will see whether there has been any growth in Private Sector Credit in Australia.


AUD/USD – 0.7833

AUD/GBP – 0.5602

AUD/EUR – 0.6371

AUD/NZD – 1.0738

AUD/JPY – 83.740

USD/BTC – $9,584


Gold – A$1695/oz

Silver –  A$21.09/oz

WTI – US$63.52/barrel


No Data

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Topics: Report, Market

Market Update - 23rd February 2018 - Commodities Slide Then Rebound As China Gets Back To Work

Posted by Patrick Downes on February 23, 2018 at 8:37 AM

The Chinese returned to work yesterday after a week long layoff and in doing so initially crushed the price of commodities almost across the board and causing some weakness in the Aussie dollar. However the flurry of trading that sent base metal as much as two percent lower yesterday arvo may have just been some initial re-balancing as commodities markets and the Aussie dollar recovered all the lost ground reasonably quickly. In fact AUD/USD is higher today than this time yesterday, while AUD/GBP teeters around 0.5600.

Bloomberg's top story reads like a battle of the titans this morning and gives some credence to the notion that no one really knows which direction the AUD will move with the title "Funds Clash Over Which Way the Australian Dollar Is Headed". Essentially you have one camp of economists who believe that the AUD is headed lower as a result of rising interest rates around the world (while Aussie rates remain stagnant) while the other camp believes a new mining super cycle may be the catalyst for the AUD to test previous highs above 0.8500 and even beyond. Personally I think both assumptions are correct and hence will likely cancel each other out meaning....drum roll...expect more of the same. AUD/USD between 0.7200-0.8200 seems like a reasonable range to me over the next 12 months.


AUD/USD – 0.7843

AUD/GBP – 0.5619

AUD/EUR – 0.6362

AUD/NZD – 1.0684

AUD/JPY – 83.727

USD/BTC – $9,982


Gold – A$1696/oz

Silver –  A$21.17/oz

WTI – US$62.63/barrel


EUR - CPI at 9.00pm

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Topics: Report, Market

Market Update - 22nd February 2018 - Markets Get A Little Jittery Again As U.S Fed Minutes Show 'Economic Momentum'

Posted by Patrick Downes on February 22, 2018 at 8:30 AM

Stocks and the Aussie Dollar more or less fell in unison overnight as the latest U.S Federal Reserve minutes showed “substantial underlying economic momentum” in the U.S which at the moment to traders means higher interest rates. The prospect of higher interest rates have more recently sent jitters through markets - which is exactly what we saw this morning with U.S equities selling off. The U.S Federal Reserve in December also boosted their 2018 economic forecasts to 2.5% growth while outsiders and analysts think the number could be as high as 2.8%. Regardless of the semantics and the exact number it would appear that rates are going higher in 2018 and the reason markets are jittery is because the Fed has a knack of raising interest until something breaks as they did in 2008 and on a number of occasions previously. Markets never enter bear markets on low growth, they enter bear markets when economic growth peaks - how far off that is is anyone's guess.

The Aussie dollar presents some compelling levels to buy at today particularly for the exporters among us as we've seen a drop in the range of about 100 points vs. the Greenback since my last report on Tuesday.


AUD/USD – 0.7806

AUD/GBP – 0.5604

AUD/EUR – 0.6349

AUD/NZD – 1.0659

AUD/JPY – 84.010

USD/BTC – $10,276


Gold – A$1696/oz

Silver –  A$21.12/oz

WTI – US$61.09/barrel


GBP - Second Estimate GDP at 8.30pm

EUR - ECB Monetary Policy Minutes at 11.30pm

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Topics: Report, Market

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