Australian and New Zealand dollars are leading the move against the US dollar - BBH

Sandeep Kanihama FXStreet Contributor

Research Team at BBH, notes that the Australian and New Zealand dollars are leading the move against the US dollar today (up to ~0.7% and 0.8% respectively).

Key Quotes

“The driving force is not Fed expectations, but a greater sense that the RBA is in no hurry to cut interest rates and that an RBNZ rate cut next month is near a done deal that had been discounted. The Aussie is having another run at its nemesis near $0.7700 that has blocked the upside over for several months. Slightly stronger than expected CPI helped the Kiwi has come up to test the 20-day moving average (~$0.7200) and a retracement objective of the nearly five-cent decline since early-September ($0.7210). A break could spur a move toward $0.7260-$0.7300. Consumer prices rose 0.2% in Q3. The median guesstimate was flat after a 0.4% rise in Q2. The year-over-year rate also stands at 0.2%. It was expected to ease to 0.1%. Kiwi is sitting just below its highs ahead of the dairy auction.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

GBP/USD hits multi-week tops around 1.3560

GBP/USD gathers fresh steam and advances to new three-month peaks near the 1.3560 zone on Friday. Cable’s sharp move higher comes after three daily drops in a row and follows the increasing selling pressure hurting the Greenback.

EUR/USD pops to fresh two-month highs, targets 1.1600

EUR/USD advances markedly, revisiting the upper 1.1500s for the first time since mid-June. The pair’s sharp uptick comes on the back of a strong retracement in the US Dollar amid BoJ intervention chatter and despite steady uncertainty in the Middle East.

Gold picks up pace, approaches $4,400

Gold rebounds toward the $4,400 mark per troy ounce on Friday, reversing the previous day’s pullback. The precious metal’s recovery comes as fresh and intense weakness keep weighing on the US Dollar, while traders keep assessing easing expectations of an imminent Fed interest rate hike and the situation from the Middle East.

Week ahead: Summer lull could be tested by geopolitics and central bank expectations

It has been a relatively monotonous week, with the US dollar desperately trying to recover from last Friday’s nonfarm payrolls-induced losses, the main equity indices trading mostly sideways amidst a quiet earnings calendar, and sovereign bond yields reminding everyone of their pivotal role in the current financial system. These market moves are partly connected to the Middle East developments.

Weekly focus: Some relief in US inflation concerns

Actual inflation data for July came out as expected with a 0.1% m/m increase in headline CPI and 0.2% excluding food and energy. Annual headline inflation remains too high at 3.4% and means that wage earners are experiencing stagnating spending power at best, and core inflation is a bit higher than the inflation target of two percent would suggest.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.