Aussie slide continues

Australian Dollar:

The Australian dollar has one again been aggressively sold when valued against its US Counterpart over the past 24 hours with a combination of factors ensuring the tide remains well and truly out for the higher yielding asset. Losing close to one full US Cent overnight the downward slide was initially triggered but comments made by the RBNZ who stepped up their rhetoric against the overvalued Kiwi, rhetoric which also had negative consequences for its Trans-Tasman rival. With the Greenback also rising to its highest mark in over four years the broader search for yields and signs of an enhanced US recovery continue to weigh on the Australian dollar. Opening weaker this morning buying 87.88 US Cents investors find themselves in uncharted territory ahead of additional economic releases from the US this evening.

• We expect a range today of 0.8750 – 0.8840

New Zealand Dollar:

In a statement which caught investors off guard yesterday New Zealand’s Reserve Bank Governor Graeme Wheeler stated the New Zealand dollar remains unsustainably and unjustifiably high warning that the currency could fall significantly over the next 6-9 months. Fuelling speculation that the Central Bank may have already or is at least planning to manually intervene, yesterday’s comments for the time being appear to have worked with the Kiwi trading from an opening level of 0.8075 down to an eventual low of 0.7913 when valued against the Greenback. Whilst excess liquidity flows from some of the worlds largest central banks having distorted values for so long policy makers were hopeful of a broader depreciation off the back of the notable drop in commodity prices. Opening this morning weaker, below the critical 80 US Cents mark the Kiwi currently buys 79.28 US Cents

• We expect a range today of 0.7880 – 0.7970

Great British Pound:

UK Stocks fell overnight after Bank of England Governor Mark Carney said the time to increase benchmark cash rate is getting closer. Sailing a similar course to that of the US Federal Reserve the BOE remains set to become one of the first and largest central banks to exit the stimulus game. Whilst unable to really take off in the face of a notably stronger Greenback the Sterling’s opens steady against the Greenback this morning at a rate of 1.6317. Meanwhile in other moves the Sterling opens higher against the both the Australian dollar 1.8557 and the New Zealand Dollar 2.0580.

• We expect a range today of 1.8520 – 1.8610

Majors:

Despite a notable fall across US equity markets the US dollar has continued its upward move overnight when valued against a handful of major currencies stronger this morning against all but one of its 31 major peers. Now sitting at its highest level since June 2010 last night’s gains were triggered by data which showed American factories received more orders than expected last month whilst the number of applications for unemployment benefits also fell. Ahead of a report tonight which is expected to show the world’s largest economy grew 4.6 percent during the second quarter of this year bets have increased substantially throughout September that the US Federal Reserve will raise interest rates as early as Q2 next year. In currency moves overnight the US dollar was broadly stronger whilst the Euro opens this morning lower at a rate of 1.2750

Data releases: 

• AUD: No Data
• NZD: No Data
• JPY: Tokyo Core CPI
• GBP: No Data
• EUR: GfK German Consumer Climate
• USD: Final GDP