Market Headlines
Equity markets seems to brush off the off news of new infections in China and was further supported by the Fed’s announcement that it would begin buying corporate bonds. The S&P500 closed the session up 0.9% with the NASDAQ was 1.4% higher.
Oil finished the session 2.3% higher, copper fell 0.8%, iron ore fell 1.8% to $103.00, and gold fell 0.3%. AUD bounced back to 0.6925 which was 2.2% off the intra-day lows 0.6777.
Currencies
The US dollar index is down 0.7% on the day.
EUR ranged between 1.1225 to 1.1333.
USD/JPY ranged between 107.20 and 107.50.
AUD came off 0.6777 – a two-week low back to 0.6925.
NZD ranged between 0.6381 to 0.6484.
AUD/NZD rose from 1.0582 to 1.0682.
AUD Thoughts
Busy day ahead with the FED’s chair Powell’s’ testimony which will provide context where around the announcement of corporate bond purchasing program. US retail sales will also be watched closely with the view that May to show a stronger result. Locally RBA Minutes expected to provide no shocks and summarize the near-term economic outlook. Markets will look for any rhetoric surrounding the AUD given it didn’t feature in Lowe’s statement despite it appreciating back to pre-COVID levels.
The range of the AUD has more than likely cleaned out a lot of order books, but markets still expect demand around 0.6780 while offering interest remains around 0.7060-should will see a spike.
Event Risk Data Today
Australia: RBA’s June Minutes.
New Zealand: Q2 Consumer Confidence
Europe: June ZEW Survey
UK: The market expects the Apr ILO unemployment rate to jump, forecasting an increase to 4.7% from 3.9% in the month prior.
US: May Retail Sales forecast to rise 7.4%, May Industrial Production, FOMC Powell testimony