Analysts at Westpac, in a market wrap, noted that after lukewarm trade in Europe, risk appetite improved in the NY session, with optimism rising over US-China talks, including a possible Xi-Trump summit in November.
"AUD/USD bounced to 0.7315. Today's calendar is light, as it is for much of the week, ahead of the Fed's Jackson Hole conference."
"A resumption of Turkish lira weakness (-3.1%) was brushed aside in Friday London/NY trade. US equities remained supported by Q2 earnings and in late trade, a Dow Jones/WSJ story claiming that US and Chinese officials were, “mapping out talks to try to end their trade standoff ahead of planned meetings between President Trump and Chinese leader Xi Jinping at multilateral summits in November.”
This was supported by White House economic adviser Kevin Hassett, who talked up this week’s meeting between lower level US and China officials (in contrast to adviser Kudlow’s dismissive comments) and also sounded upbeat on NAFTA negotiations."
"The US dollar lost ground on the optimism over trade talks. EUR/USD rose from 1.1380 to 1.1440, GBP/USD +30 pips to 1.2745 early Monday. AUD/USD edged up to 0.7280 in the NY morning, then bounced to 0.7315 on the US-China story. Outperformer NZD/USD starts the week around 0.6640, up 0.8% overall. AUD/NZD ranged sideways between 1.1000 and 1.1040. USD/JPY did not follow risk sentiment higher, edging down -0.3% to 110.55."
"The University of Michigan’s preliminary August consumer sentiment survey fell a larger than expected 2.6pts to 95.3 - its lowest in eleven months, but a still historically elevated level of optimism. Less upbeat views on buying big-ticket durable items drove the index lower while negative news recalled on trade tensions continued to trend higher.
Canada July CPI was much stronger than expected, up 0.5%mth, 3.0%yr versus expectations for inflation to hold at 2.5%yr. Underlying inflation however was a touch softer than expected, 1.9%yr, so the Bank of Canada should not be too concerned by the highest headline inflation since 2011. Markets place around a 1/3 chance of the BoC hiking to 1.75% on 5 September. USD/CAD responded sharply to the data, sliding from 1.3140/50 to 1.3070. NAFTA headlines also helped CAD."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these securities. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Forex involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.