The S&P 500 finished today’s session slightly higher in quiet trade having come off a soft session on Thursday. Elsewhere, oil climbed 1% to $108 a barrel while U.S yields also edged fractionally higher since last Thursday’s report. The USD has been stronger across the board which pushed the EUR/USD to a low of 1.0770 while the AUD/USD was trading at the lower end of its .7343/.7402 range late in the day last week with holiday trading seeing limited flow although the USD did outperform slightly which saw the AUD/USD trade to a low of 0.7392 on Friday and opens today at 0.7351. at the time of writing.
Chinese GDP, IP and Retail Sales were the headline data prints during Asia, with a modest beat seen by most measures. Surprisingly, GDP printed at 4.8%, ahead of expectations of 4.2% leading some to question the ‘authenticity’ of numbers. Retail Sales came in at a more believable contraction of -3.5%.
Currencies were largely unchanged as a result though AUD/USD slid to new lows of 0.73515 ahead of the London open with the USD generally stronger. NZD/USD fell to lows of 0.6726 while EUR/USD dipped to 1.07835 and GBP/USD made lows of 1.3008. USD/CAD moved up to 1.26435 highs while USD/JPY was largely steady near 126.60.
Into the NY open and the NAHB Housing Market Index for April printed at 77 as expected. Unsurprisingly no reaction to the data with Wall St opening to small gains. European markets remained closed for the Easter Monday holiday. The USD firmed over a very quiet NY session with AUD/USD sliding to lows under 0.7350 while NZD/USD fell to 0.67165. EUR/USD and GBP/USD made respective lows of 1.0770 and 1.3005 while USD/JPY moved up towards 127.00. USD/CAD the exception as it fell to 1.26055 before recovering.
Currency ranges over the last 24 hours
Source of data Macquarie Morning Report
Later this morning, the Minutes from the early April RBA Board meeting will be released. The minutes will be interrogated for just how close the Board is to pulling the trigger on increasing the cash rate (most economists and as a result market expectation expect June). Markets will be looking for any signals that the Board now thinks that they may have to tighten monetary policy more quickly than they have thought until very recently. Additionally, the Board will announce in May the Bank’s approach to whether to reinvest proceeds of maturing bonds it holds (the market expects no reinvestment) so the Minutes may provide some hints as to which way the Board is leaning.
The AUD/USD has traded poorly over the Easter holidays and bottomed out at .7343. Further demand is expected ahead of .7340 and again at .7315 while offering interest remains above .74c
• AU – RBA Minutes
• CA – March Housing Starts
• US – March Building Permits and Housing Starts