Aussie dollar holds steady above US$0.67
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Daily Currency Update
The Australian dollar is slightly weaker this morning when valued against the Greenback, currently trading at US$0.6755 at the time of writing. The Aussie dollar continued its losing streak on Monday as the US dollar gained further after September's upbeat United States (US) employment data. This has forced traders to unwind the Federal Reserve (Fed) rate cut for the upcoming policy meeting in November. Instead of continuing to decline, the Australian dollar (AUD) is more likely to trade in a sideways range between US$0.6725 and US$0.6825.Looking ahead today, we will see the release of both the Westpac Consumer Sentiment and NAB Business Confidence. The Reserve Bank of Australia (RBA) will also release the latest Monetary Policy Meeting Minutes. The Minutes are a detailed record of the RBA Reserve Bank Board's most recent meeting, providing in-depth insights into the economic conditions that influenced their decision on where to set interest rates. The RBA kept its Official Cash Rate (OCR) unchanged at 4.35% and didn’t offer any timeline to kickstart the rate-cut cycle.
Key Movers
The US Dollar Index (DXY), which measures the value of the USD against a basket of currencies, witnessed a calm Monday session with mild losses, holding steady despite elevated levels near last week's highs. Key events this week to look out for is the release of the Federal Reserve's (Fed) Federal Open Market Committee (FOMC) Meeting Minutes and US Consumer Price Index (CPI) data. The probability now of a 50 bps cut in November or December is unlikely according to market investors which still anticipates 125 bps of total easing in the next 12 months.The Dow Jones Industrial Average fell 0.9%, while the S&P 500 and Nasdaq Composite shed 1% and 1.2%, respectively. The major indexes closed sharply higher on Friday after a better-than-expected September jobs report reinforced the idea that the U.S. economy is headed for a soft landing. The Dow finished last week at an all-time closing high, while the S&P 500 was just shy of a record of its own when trading kicked off this week.
The yield on 10-year Treasury's, which is sensitive to expectations around where interest rates are headed, moved above 4% on Monday for the first time in two months. The 10-year yield was at 4.02% recently, up from 3.98% on Friday. Gold futures were little changed at around $2,660, while bitcoin was up 1% around $63,300.
Expected Ranges
- AUD/USD: 0.6650 - 0.6850 ▼
- AUD/EUR: 0.6050 - 0.6250 ▼
- GBP/AUD: 1.9200 - 1.9400 ▲
- AUD/NZD: 1.0900 - 1.1100 ▲
- AUD/CAD: 0.9100 - 0.9300 ▼