Sentiment sagged overnight, amid rising Covid cases, warnings from Fed Chair Powell, and further setbacks in US stimulus talks. The S&P500 is down 1.0%, and bond yields and risk sensitive currencies are lower. US 2yr treasury yields fell from 0.18% to 0.17%, while the 10yr yield fell from 0.94% to 0.89%. Australian 3yr government bond yields (futures) traded around 0.18%, while the 10yr yield fell from 0.93% to 0.89%. Commodities, Brent crude oil futures rose 0.7% to $44.10, copper rose 0.1%, iron ore fell 1.2% to $123.20, and gold rose 0.6%.
AUD/USD: 0.7224 – 0.7282
EUR/USD: 1.1759 – 1.1823
GBP/USD: 1.3108 – 1.3203
USD/JPY: 105.10 – 105.42
USD/CAD: 1.3059 – 1.3150
NZD/USD: 0.6844 – 0.6884
AUD/JPY: 75.94 – 76.69
AUD/NZD: 1.0563 – 1.0587
AUD/USD came under pressure on its way to a low of 0.7224 overnight. Demand should slow this dip ahead of 0.7220 and again at 0.72c while offering interest still rests back toward 0.7340.
Event Risk Data Today
New Zealand: The October manufacturing PMI will be released, following four straight months in expansionary territory. Westpac expects the food price index to fall 0.4% in October, although annual price growth is currently running around 3%yr.
Euro Area: The September trade balance is due, and after finding a trough in April, the surplus has continued to widen. Following this, the 2nd estimate of Q3 GDP should confirm the 12.7% rebound from the advance reading.
US: With upstream price pressures still weak, the October PPI is expected to print at 0.2%. Finally, the November University of Michigan Consumer Sentiment Survey should hold around 82.0. The index has lagged the broader resurgence in activity.