Aussie cools off in subdued trade

Australian Dollar:

Recovering off dropping to 4 year lows on Wednesday night the Australian dollar rebounded on Thursday taking the lead from domestic and offshore data. Underpinned by the large Greenback sell off the night prior Aussie began trade drifting higher as investors sat patiently waiting on domestic private capital expenditure numbers. The data showed a 0.2 per cent uptake and the Aussie strengthened further. Overnight the AUD’s momentum slowed due to lack of market data opening this morning just below Thursdays open at 0.8547. Heading into the weekend onlookers are expecting trade to be subdued with Thanksgiving in the US and will look to local private sector credit for direction.

• We expect a range today of 0.8505 – 0.8585

New Zealand Dollar:

Despite the minor setback of a worse than anticipated Trade Balance the New Zealand dollar gained ground against an overstretched US dollar on Thursday, testing the US79 cent handle during Asian trade. Weaker than expected export numbers produced a disappointing trade balance as the higher yielding currency continues to be hit amid falling commodity prices. Overnight the Kiwi drifted continuously lower as Greenback strength was witnessed leaving the higher yielding currency to open a shade lower than yesterday’s open at 0.7871. As we head into the weekend ANZ business confidence and building consents will provide direction with the US on holiday for Thanksgiving.

• We expect a range today of 0.7830 – 0.7910

Great British Pound:

With no local data to steer the GBP and an absence of economic indicators from the US the Sterling lost ground in line with most majors against the US dollar overnight as Greenback strength was witnessed. Cable fell as low as 1.5717 and opens this morning at 1.5738 over half a cent lower pulling away from two week highs. The British Pound struggled in a similar fashion against the Aussie(1.8411) and Kiwi(1.9994) failing to gain momentum in the lightly traded session. Heading into the weekend investors will expect subdued trade to continue with thanksgiving in the US and very light consumer confidence numbers in the UK.

• We expect a range today of 1.8370 – 1.8450

Majors:

After a previous few trading sessions where the US dollar has taken centre stage last night the Euro stepped into the limelight with an array of high impact data being released. The main announcement was the German inflation figures which disappointed showing the data almost touching 5 year lows. The CPI numbers will bring additional stimulus talks back to the forefront as they have been previously mentioned as an example of an aggressive policy to get the Eurozone’s economy back on track. The Euro continued to fall as ECB president Draghi weighed in continuing to mention the ECB will use whatever is needed to spur growth in the struggling Eurozone. The EUR opens this morning just under half a cent weaker against the US dollar and with Thanksgiving in the US today investors will watch another string of Eurozone releases mainly the CPI flash estimate for direction.

Data releases: 

• AUD: Private Sector Credit m/m
• NZD: Building Consents m/m, ANZ Business Confidence
• JPY: Household Spending y/y, Tokyo Core CPI y/y, National Core CPI y/y, Unemployment Rate, Prelim Industrial Production m/m, Retail Sales y/y, Housing Starts y/y
• GBP: GfK Consumer Confidence, Nationwide HPI m/m
• EUR: German Retail Sales m/m, French Consumer Spending m/m, Italian Monthly and Quarterly Unemployment Rate, CPI Flash Estimate y/y, Core CPI Flash Estimate y/y, Unemployment Rate, Italian Prelim CPI m/m
• USD: Bank Holiday