Marketwatch APAC

Daily Insights
August 21, 2023

The Australian dollar is trading in a narrow range for the last three days, with a slight open higher today in Asia at 0.6418.  The Aussie dollar had a 1.4% fall on Friday with Australian jobs data unexpectedly dropping, along with the unemployment rate heading higher. July jobs dropped by 14,644 after an expected rise of +15k and the unemployment rate rising to 3.7% for July. This pulled the Aussie dollar to fresh year lows of 0.6387.  There has been limited economic data out of Australia, but the market is keeping a sharp eye on the U.S. Federal Reserve Chair Jerome Powell’s speech at Jackson Hole on Friday, as well as a number of other Fed Reserve interviews this week by several other Fed Officials.

There is some data we will be awaiting out of Australia today with the Flash Manufacturing PMI along with CB Leading Index.  Out of New Zealand, Retail Sales is expected to come in just slightly better than the previous month at -0.4 from a -1.4%.  The Kiwi has also recovered slightly to trade at 0.5932, up from its previous low of 0.5897 yesterday.

The People’s Bank of China (PboC) has slashed rates to its one-year Loan Prime Rate (LPR) from 3.55% to 3.45% giving a slight boost to the Aussie dollar. China’s current economic slowdown keeps worsening with news of bankruptcy proceedings for a very large Chinese property developer, Evergrande.  Debt is China’s largest problem attributed to its economic slowdown, with many unable to meet its obligations. Currently, China’s total debt has surged close to 300%, above an average of just under 250% for an average of 20 economies. China officials appear to be limiting the yuan currency supply, which in turn pushes up the CNH funding costs, in an effort to squeeze offshore short positions. This is causing a major move in its one month forward points to over 1.5%, the largest jump in six years.

Economic Calendar

JPY - BOJ Core CPI y/y
CHF - Trade Balance
GBP - Public Sector Net Borrowing
EUR - Current Account
All - BRICS Summit
GBP - CBI Industrial Order Expectations
USD - Existing Home Sales
USD - Richmond Manufacturing Index
AUD - CB Leading Index m/m
USD - FOMC Member Goolsbee Speaks
USD - FOMC Member Bowman Speaks
NZD - Retail Sales q/q
NZD - Core Retail Sales q/q
AUD - Flash Manufacturing PMI
AUD - Flash Services PMI

Market Indicators

Currency Pairs
Pair High Low
aud/usd 0.6418 0.6411
nzd/usd 0.5933 0.5920
aud/nzd 1.08933 1.0809
usd/jpy 146.23 146.14
usd/cad 1.3555 1.3541
eur/usd 1.0902 1.0892
gbp/usd 1.2766 1.2753
aud/eur 0.5890 0.5884
aud/jpy 93.828 93.722
aud/cny 4.6771 4.6724
Equities and Commodities
S&P 500 4399.77
DOW 34463.69
Nasdaq 100 13497.59
ASX200 7115.47
GOLD 1894.96
WTI 80.83

This document is for information purposes only and does not constitute any recommendation or solicitation to any person to enter into any transaction or adopt any trading strategy, nor does it constitute any prediction of likely future movements in exchange rates or prices or any representation that any such future movements will not exceed those shown on any illustration. All exchange rates and figures appearing are for illustrative purposes only. You are advised to make your own independent judgment with respect to any matter contained herein.