Currency markets were in full swing overnight with a steady stream of economic data releases and overhanging geo-political concerns to deal with.
The Australian dollar’s impressive week continued up 2.8 cents from Fridays close and putting on a full cent after yesterday’s GDP print to peak at 91.86 US cents, it was also helped by China's services sector expanding in August. There was some minor pull back for the Greenback with the US senate passing limited strike action against Syria although it much easier for Obama to get legislation through the Democrat controlled Senate than the Republican controlled Congress. The Gold price suffered the night biggest falls, down $30 before the Senate vote helped it back up to 1395 USD an ounce.
Last year it was hard to remember when there was positive news out of the UK, this year from an economic standpoint it’s hard to remember when it wasn’t. This time is was Services PMI ahead of estimates at 60.5, and the Pound surged to 1.563 USD before the usual post news pull back we have seen with Pound but it resumed gains in the US session to peak another 15 pips higher.
Our North American events were of a more low key nature following, as US trade balance data was broadly in-line with market estimates and the Bank of Canada keeping rates on hold as exports fail to pick up as expected. The US dollar however did lose ground against the Loonie and is now just shy of 1.05 CAD.
The Australian dollar will continue to have the spotlight on it this morning with our own Trade Balance data up at 11.30am. After lunch we will see the Monetary Policy Statement from the Bank of Japan which the market consensus is for the BOJ to refrain from adding any further stimulus. The Aussie currently sits 91.448 Yen, over 4 Yen up this week so far.
Joel Murphy
www.pepperstone.com Joel Murphy is a currency analyst and market commentator for Forex Broker Pepperstone and he regularly features on Sky Business News Australia. He has worked in both retail and institutional Forex for last 8 years and completed a Bachelor of Commerce and a Bachelor of Arts from Monash University
