Overall sentiment appeared to be upbeat, supported by optimism on vaccines and economic recovery. The S&P500 is up 0.4% whilst US yields were flat as attention shifts to tonight’s FOMC meeting. Brent crude oil futures rose 2.6% to $40.65, copper fell 0.4%, iron ore fell 0.7% to $129.40, and gold fell 0.1%. The bi-month GDT dairy auction resulted in prices overall rising 3.6%, with whole milk powder up 3.2%
AUD/USD: 0.7293 – 0.7342
EUR/USD: 1.1839 – 1.1900
GBP/USD: 1.2842 – 1.2927
USD/JPY: 105.30 – 105.81
USD/CAD: 1.3141 – 1.3203
NZD/USD: 0.6708 – 0.6738
AUD/JPY: 76.89 – 77.50
AUD/NZD: 1.0864 – 1.0907
- AUD/USD keeps the 20-pip range between 0.7290 and 0.7310 after stepping back from the highest in two weeks.
- Markets cautious amid a lack of major data/events in Asia.
- The pre-Fed sentiment and mixed clues from the risk catalysts also restrict the quote’s performance
AUD sustained trading beyond the 21-day SMA, at 0.7266 now, keeps the buyers directed to towards the monthly high near 0.7415. Also providing strong downside support is an ascending trend line from July 14, currently around 0.7225.
Event Risk Data Today
Canada: CPI inflation is expected to remain weak (prior: 0.1%, market f/c: 0.4%).
Europe: The global recovery will be reflected in July’s improving trade balance (prior: 17.1, market f/c: 19.3).
New Zealand: The current account deficit is expected to narrow in Q2 due to a sharp fall in import values (prior: -2.7%, market f/c: -2.3%). The Pre-Election Fiscal Update will reflect a stronger outlook compared to the May Budget forecasts.
UK: CPI is expected to contract in August as temporary sales tax cuts and the government’s meal discount scheme impact (prior: 0.4%, market f/c: -0.6%).
US: Retail sales growth is forecast to have moderated further in August (prior: 1.2%, market f/c: 1.0%). Business inventories are swinging from a negative to positive for growth (prior: -1.1%, market f/c: 0.2%).
The FOMC is widely expected to keep rates on hold in September. Further detail on the new policy framework and their view of the risks will be the focus of Chair Powell’s post-meeting press conference (04:30 AEST).