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.
As widely expected the U.S Fed, led by Jerome Powell, chose to cut rates yet again bringing the official federal funds rate back to 2.00%. Fed Chair Powell noted that the reason for the cut in interest rates was to support the growth that is already occurring in the U.S economy and to help offset some of the impacts of Trump's trade war and accompanying investor uncertainty. In a few subtle jabs at Trump's policies, Powell also noted that the slowing growth "in exports and business investment" locally was due almost entirely to Trump's chosen trade policies.
The Aussie Dollar has fallen following the rate cut and is down right across the board. AUD/USD which has been stoic in the 0.68's lately is threatening to break lower, while AUD/EUR and AUD/GBP are also marginally lower.
The latest employment numbers and unemployment rate are due out this morning, followed by interest rate decisions in Japan and the U.K. However, the most important data is the ABS employment numbers due at 11.30am. The unemployment rate is tipped to remain unchanged at 5.2% while a little over 15,000 jobs are estimated to have been created last month. A bumper number or poor result could have a meaningful impact on the Aussie Dollar and so clients wishing to avoid risk would be advised to book payments ahead of the result.
AUD EXCHANGE RATES:
AUD/USD – 0.6801
AUD/GBP – 0.5442
AUD/EUR – 0.6159
AUD/NZD – 1.0764
AUD/JPY – 73.704
All Ords (XAO) – 6,791
Gold – A$2,186/oz
Silver – A$25.99/oz
WTI – US$58.06/barrel
DATA RELEASES TODAY:
AUD - Employment Change & Unemployment Rate at 11.30am
GBP - Retail Sales m/m at 6.30pm
GBP - Official Bank Rate & Monetary Policy Summary at 9.00pm