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.
The Aussie Dollar has started the week mixed, gaining vs. the EURO and JPY but falling vs. the Greenback and Pound. The latest Australian economic data suggests more interest rate cuts from the RBA are likely, which you'd have to think will continue to drag the Aussie Dollar lower over the next 6-12 months. Current consensus forecasts suggest a range of 0.6600-0.7000 over the short to medium terem.
U.S and European equities made solid gains overnight suggesting a fair dose of trade deal optimism has been once again intravenously injected into markets. European and U.S stocks gained as much as 0.93% and 1.32% respectively while the Dow Jones broke 28,000 for the second time this year. The final quarter of the year is typically a good quarter for stocks, so another month and a half of gains could see optimism stretch deep into Christmas and New Years.
An ACTUAL trade deal between China and the U.S is starting to be priced in, but it still begs the question what happens to markets post such an event? Will it be a buy the rumour, sell the news event or will markets and the AUD rally into U.S elections next year. A lot to think about, but I suggest continued caution, especially for importers given the bias for a lower AUD.
AUD EXCHANGE RATES:
AUD/USD – 0.6745
AUD/GBP – 0.5221
AUD/EUR – 0.6123
AUD/NZD – 1.0544
AUD/JPY – 73.500
All Ords (XAO) – 6,835
Gold – A$2,147/oz
Silver – A$24.95/oz
WTI – US$57.94 barrel
DATA RELEASES TODAY:
USD - Fed Chair Powell Speaks at 11.00am
AUD - RBA Gov Lowe Speaks at 8.05pm
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Senior Corporate FX Dealer
Phone Patrick - 0431 278 632
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