The Australian dollar is sitting back just were it opened trade for the week yesterday after it managed to peak at 94.18 US cents overnight. It was well supported through a relatively tame European session before we had Treasury International Capital Data for September which showed an increase in foreign resident’s holdings of long-term US securities. From this point the Australia dollar starting creeping back down to current levels and it was compounded by a speech from the Fed’s William Dudley, who holds a dovish current stance, highlighting that he is “getting more hopeful' whilst not alluding to any changes to tapering. The speech did see a shift back further to the US dollar but not by much more than 10 pips.
The Euro sits above its open yesterday with a shrinking Current Account balance failing to dampen its support as it traded up to 1.3541 USD. It eased back in tandem with the Aussie, Pound and Kiwi which all roughly fell 40 pips across the board through the US session.
Our Local session is likely to be a lot more volatile than yesterday with Monetary Policy Meeting Minutes to be released at 11.30am with likely more detail on the statements negative assertions around our high Aussie dollar expected. The focus again turns to Europe with German ZEW Economic Sentiment index and then more speeches from Fed members through the US session.
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
