Volumes thin given US Thanksgiving

Australian Dollar:

Having started the day up above the 0.7250 mark when valued against its US Counterpart, the Australian dollar ran into some well-established headwinds following the release of capital expenditure data for the third quarter of this year. Revealing that Australian firms wound back investment spending by 9.2 percent, a number far worse than the expected read of 2.9 percent, an accelerated drop threatens to leave an even larger gap in projected growth and budgetary forecasts over the medium-term. In what’s likely to be session dominated by poor liquidity flows given the US public holiday the Australian dollar opens this morning marginally lower at a rate of 0.7227

• We expect a range today of 0.7200 – 0.7300

New Zealand Dollar:

The New Zealand dollar offered little to excite investors through trade on Thursday succumbing to a tight trading range between 0.6560 – 0.6596. The Kiwi moved to the top end of technical resistance points touching intraday highs at 0.6596 following a stronger than anticipated trade balance print before moving lower and settling into a 10 point bracket throughout the remainder of the trading day. Attentions today are likely to be divided with little headline data across the global economic docket. We anticipate volumes to remain stretched as the US enjoys Black Friday and Thanksgiving weekend celebrations.     

• We expect a range today of 0.6550 – 0.6600

Great British Pound:

The Great British Pound struggled to mount any meaningful recovery through trade on Thursday and appears stretched on moves above 1.5120/30. With little domestic data on hand to drive direction and volumes spread as the US enjoyed thanksgiving celebrations Sterling bounced about amid support and resistance as investors continue to weigh up diverging monetary policy expectations. Attentions today turn to 3rd quarter GDP estimates for direction into the weekend. We anticipate some volatility in light of thinner volumes however anticipate Cable will remain under pressure as the possibility of a Fed rate amendment looms ever closer.

• We expect a range today of 2.0750 – 2.1050

Majors:

US Thanksgiving meant US dollar moves were almost completely absent during overnight trade, with very light volumes seeing the worlds reserve currency remain comfortably within its recent ranges. Contributing very little to broader currency flows, the main moves overnight came from Europe with the shared unit dropping to its lowest level in seven months, assisted by falling bond yields and stronger equity markets. Given accelerated talks that the European Central Bank will unleash further easing when they meet next week, policy makers are considering options which include staggered charges on banks which are hoarding deposits. As part of a broader effort to lift inflation, signs of additional easing only further threaten to undermine the euro’s value which dropped to a 24 hour low of 1.0599. Opening on shaky ground this morning the euro is currently trading at a rate of 1.0606 when valued against its US Counterpart.

Data releases

• AUD: No data today
• NZD: No data today  
• JPY: Household Spending y/y, Tokyo Core CPI y/y, Spanish Flash CPI y/y
• GBP: Second Estimate GDP q/q
• EUR: No data today
• USD: Bank Holiday