Market remains relatively unchanged despite global market sell off

AUD / USD: Expected Range

0.7320 – 0.7490

Figures released by the ABS yesterday showed a slide in Private Capital Expenditure by 4% for the third quarter. Reduced investment in the mining sector had played a part in the decline and sets the tone for a downgrade to the expectations of next week’s third quarter GDP figures due out on Wednesday. The Australian Dollar see-sawed through yesterday’s day of trade between levels of 0.7361 and 0.7420 and opens this morning a shade higher at 0.7418. In other news, U.S unemployment claims rose more than expected however, the numbers were still under 300k for the week which is an indicator of a firming labour market. Australian Retail Sales due out at 11:30 today for the month of October which are expected to rise 0.3% and later on this evening the widely-anticipated Unemployment figures from the US. 

 

NZD / USD

Expected Range: 0.7040 – 0.77120

The New Zealand dollar opens this morning little changed when valued against its US Counterpart at a rate of 0.7084. Having traded to an overnight high of 0.7104 the past 24 hours has been a largely uninspiring trading window for the Kiwi with investors already sitting on their hands ahead of this evening’s non-farm payrolls report from the United States. With the Greenback still oscillating at levels just shy of a 16-year high, the Greenback has the potential to further add to those gains should labour market figures confirm that the world’s largest economy added in excess of 180 000 new jobs last month. 

 

GBP / AUD

Expected Range: 1.6900 – 1.7025

The Great British Pound extended to reach fresh two weeks’ highs when valued against its US Counterpart overnight reaching an eventual peak of 1.2588. Amid signs that a lower Sterling is already starting to stir up domestic price pressures, figures overnight confirmed that growth in manufacturing activity had slowed during November when compared to the past three months. In an end to the week which remains set to be dictated by macro-developments from the United States a reading on construction activity is also likely to garnish consideration attention. Opening stronger versus the US dollar at a rate of 1.2588 the Sterling is stronger across the board notching up gains versus both the Australian dollar (1.6975) and the New Zealand dollar (1.7769). 

 

USD, EUR, JPY

The sell-off in global bonds extended their rout on Thursday whilst financial shares built on some already impressive gains in the aftermath of President Trumps Victory. Spurred by speculation that the European Central Bank is close to signalling an end to monetary stimulus, lower monetary assistance from Europe, combined with higher rates from the Fed and Fiscal assistance from Trump has well and truly been the driving force behind reflationary trades over the past month. With inflation expectations rising, the sell-off in global bonds hints that Central Banks will be looking to buy sovereign debt at a significantly reduced rate over the near-term. Falling versus the Yen and the Euro in overnight trade the US dollar has lost some ground over the past 24 hours as investors remain eager to see whether Thursday’s encouraging private employment report will feed through to a positive non-farm payroll announcement tonight. Sitting front and centre, the world’s reserve currency holds the key this evening with the official rate of unemployment set to remain steady at a rate of 4.9 percent.