Market Watch AU – 8th November 2023
The AUDUSD has experienced a volatile day, trading as high as 0.65-cents before retreating to 0.6404 in offshore activity. The Reserve Bank of Australia (RBA) yesterday, raised Cash Rates by 25bp to 4.35%, as widely expected, but the accompanying statement was considered by markets as dovish, with the committee rephrasing the requirements for further rate hikes, by suggesting that any future tightening would be data dependent and subject to continuous risk assessment. On a macro stage, the China Trade data yesterday was mixed, with imports rising unexpectedly in October while exports contracted faster than was expected, sending indications that the recovery of their economy is still mixed. This also managed to deflate the AUDUSD along with some US-dollar strength overnight. A rise in Wall Street equities and a drop in US Treasury yields was a plus for the Aussie to recover from session lows. The pair opens with a cautious tone today with traders looking for resistance at 0.6500/10 to be prominent and buying interest to support at the psychological 0.6400 ahead of 0.6370 behind. With no essential economic data releases today , attention turns to Fed Chairman Powell’s speech later tonight and the RBA Statement of Monetary Policy on Friday.
Wall Street indices roared higher as Treasury yields fell, though investors are weighing up the Fed member commentary about a too strong US economy that may require the central bank to consider another interest rate hike to tame inflation. The DJI rose +0.3%, the S&P500 gains +0.4% and the Nasdaq closed up +1%. Australian shares lost ground yesterday , after the RBA hiked its interest rates by another 25bp, sending banking and energy shares lower.
Gold prices slipped to a two week low, as safe haven buying that was brought about by the Middle East conflict , dried up and oil prices hit 2-1/2 month lows
Copper prices on the LME reversed from recent highs as the US-dollar found strength and traders re-assess the demands from China after a mixed bag of Trading data released for October during the session yesterday. Iron Ore prices dropped as traders fear that the Chinese authorities will monitor futures contract trading volumes in a bid to control prices and dissuade speculative positions.
Crude Oil prices dropped to a 2-1/2 month low, shedding 4% on Brent and US Crude alike, as mixed data out of China offset the impost of Saudi and Russian output cuts.
Open today 0.6436
Yesterday’s Range 0.6404 / 0.6501
Open today 0.5936
Yesterday’s Range 0.5911 / 0.5970
Yesterday’s Range 1.0821 / 1.0900
Yesterday’s Range 0.6001 / 0.6069
Yesterday’s Range 4.6706 / 4.7335
Yesterday’s Range 0.5212 / 0.5268
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