Bell FX Currency Outlook: The Australian Dollar is a little lower following some USD strength last night.
Australia: Yesterday's RBA rate announcement saw little new information released, with the cash rate remaining unchanged at 2.5%. The wording of the statement was mostly unchanged with monetary policy "appropriately configured" as the RBA continue to see a "period of stability in interest rates".
Wording around inflation was also unchanged as it remains "consistent with target". Earlier yesterday Australian trade balance for June was released, and despite seeing the deficit AUD 300M lower than expected (driven by stronger exports), there was little reaction fromthe market.
The AUD is currently trading around 0.9305 against the USD, down from levels around 0.9330 yesterday, driven by USD gains overnight. With no economic releases in Australia today it promised to be fairly quiet as the market awaits the all-important employment data tomorrow.
Majors: The USD was one of the better performing currencies last night, gaining to an almost nine-month high against the EUR, with some gooddata boosting the currency. July ISM non-manufacturing index jumped to 58.7 (56.5 expected) from 56.0 in June, with the composition of thenumbers also positive as employment, business activity and new order components all rising.
In Europe the final eurozone composite PMI was worse than expected (53.8 vs. 54 expected), helping keep the EUR on the defensive, while the GBP had a strong session after a good services PMI figure. The NZD was the worst performing G10 currency last night, with poor dairy auction results weighing on the currency.
Further to this it is down again this morning after employment data slightly missed expectations. It is a relatively quiet night for data releases, with German factory orders, UK industrial production and US trade balance the main ones to watch.Economic Calendar06 AUG NZ HLFS (unemployment rate)UK Industrial Production MoMUS Trade Balance
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