The AUDUSD opens the week at depressed levels, though with no surprises, as the market awaits the outcomes of the RBA Meeting tomorrow. Downbeat Australian data came in contrast to upbeat and firmer US releases and weighed heavily on the Aussie last week. News over the weekend that China would be unveiling more measures to support their economy has helped to consolidate the AUDUSD moves in the opening hours of the session today. For traders, the retreat of the Aussie has exposed support at 0.66-cents with noted bids ahead at 0.6620’s, while rallies will be likely be contained to 0.6695 for now, with AUDJPY flows influencing the Aussie during Asia sessions. As mention the RBA meets tomorrow, where markets have wound back their expectations of a rate hike to price in just a 22% chance of a hike at this meeting. Economist however have polled a slightly higher chance, with a bias towards 25bp.
Wall Street added gains across the session and closed out a positive week, spurred on by solid earnings in big tech names as well as better US economic data offering an improvement in market sentiment. The DJI gained 0.5%, the S&P500 added 1.0% and the Nasdaq closed higher, gaining 1.9%% for the session. Australian shares look to open higher today though investors may remain cautious and sidelined ahead of the RBA meeting tomorrow.
Gold prices turned higher into the weekend reversing its previous day’s losses as the US-dollar cooled and confidence mounting that US inflation was heading in the right direction for the US Fed to end its tightening cycle soon.
Copper prices rebounded higher aided by the US inflationary outlook that is returning confidence to investors. Iron Ore prices continued their slide, as traders seek more context over the detail for China’s pledge to support their economy, though the weekend news releases may help to turn that sentiment.
Brent Crude Oil prices settled higher for the day and maintained its weekly trend, as traders see optimism in the wake of supply cuts providing buoyant prices.