EncoreFX’s daily market updates are written by our experienced and professional dealing team.
by George Hopkinson
The USD eased back on Friday as weaker data drove yields lower. This week its fate is in the hands of the FOMC. For the AUD the week will start quietly, with employment the key event on Thursday.
The AUDUSD gained traction on Friday with renewed risk-on sentiment and rose toward the 0.7100 figure. The greenback then eased further into Friday nights session as weaker data drove treasury yields lower.
There were initial reports of the U.S. seeking to delay the Trump-Xi summit too late April however, Chinese news agency Xinhua claimed that both sides were able to make further progress in trade negotiations following Chinese Vice Premier Liu He’s phone conversations with Treasury Secretary Mnuchin and Trade Representative Lighthizer.
There are three key central bank data releases this week. The RBA meeting minutes released tomorrow and the FOMC and the BOE meeting on Thursday. All are expected to hold interest rates steady, however future interest rate direction clues will be searched for in the statements.
Other key data releases throughout the week include:
We may see a tumultuous week in Europe due to the ongoing Brexit negotiations. PM Theresa May will be seeking an agreement with the EU to extend the deadline of Article 50.
On the technical side, the AUDUSD has stubbornly held on to the 0.7000 level. Of the last 24 trading weeks, 16 have seen the AUDUSD trade into the 0.70’s at some stage across the week. Yet there has only been one day where the AUDUSD dipped below 0.7000 – indicating a huge amount of AUD buyers exist at this level. This is fuelling the expectation that the AUD is undervalued.
© Copyright - EncoreFX, 2018.EncoreFX (Australia) Pty Ltd ABN 42 607 244 879 AFSL 479 870 is the issuer of the financial products in Australia. The information on this website has been prepared without taking into account your objectives, financial situation or needs and so before acquiring any financial services or products from EncoreFX, you should consider the appropriateness of the information having regard to your own objectives, financial situation or needs. You should obtain the product disclosure statement (PDS) for the relevant product and consider the PDS before making any decision to acquire the product. The information on this website is not directed at residents of any country other than Australia and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation. It is the responsibility of visitors to this website to ascertain the terms of, and comply with, any local law or regulation to which they are subject.