Send Payments Weekly trading update! 27th May 2024
In The News Today! 🌏
– Market Conditions and what to look out for this week 🗓️
Australian Dollar Performance:
The Australian Dollar (AUD) gained ground due to risk-on sentiment following softer UoM 5-year Inflation Expectations reported on Friday.
Australian equities rose above 7,770, buoyed by gains on Wall Street.
The AUD extends its gains against the US Dollar (USD) for the second consecutive session on Monday, driven by improved market risk appetite despite diminishing expectations for Federal Reserve interest rate cuts.
US Dollar Weakness:
The US Dollar weakened after the University of Michigan's 5-year Consumer Inflation Expectations for May eased to 3.0%, below the estimated 3.1%.
Upcoming Australian CPI Report:
Investors are eagerly anticipating the Monthly Australian Consumer Price Index (CPI) report on Wednesday for insights into domestic monetary policy.
The latest Reserve Bank of Australia (RBA) meeting minutes suggested difficulty in predicting future changes in the cash rate, with recent data indicating a likelihood of inflation persisting above the 2-3% target.
Political and Economic Predictions:
Analysts predict that a second Trump presidency would push deficits higher than re-electing President Joe Biden. Trump’s proposed policies of continued tax cuts and increased spending are expected to significantly increase the federal deficit.
While Biden’s administration has also spent more than it has taken in taxes, experts argue that Trump’s approach would be more disruptive to the economy.
Commodity Prices and AUD Support:
The recent upsurge in metals prices, including Iron Ore hitting its highest levels since February, is expected to support the Australian Dollar.
The ongoing risk rally across asset classes suggests a bullish outlook for risk-sensitive commodity dollars, including the AUD.
Last week 🗞️
Key Takeaways:
Australian Economy: Steady manufacturing PMI but a slight slowdown in services and overall economic activity.
UK and GBP: Strength in the Pound Sterling due to fading expectations of a BoE rate cut, supported by a slower-than-expected inflation decline.
US and USD: Weakness in the US Dollar as hawkish FOMC communication has been priced in.
Oil Market: Potential early signs of a bullish reversal in WTI Crude Oil prices, though confirmation is needed.
Eurozone Economy: Improved manufacturing PMI and steady services PMI indicate an easing downturn and stable growth, respectively.
Things to look out for this week;
Monday 27th May
🇯🇵 BOJ Gov Ueda Speaks - JPY
Wednesday 29th May
🇺🇸 CB Consumer Confidence - USD
🇦🇺 CPI y/y - AUD
🇩🇪 German Prelim CPI m/m - EUR
Thursday 30th May
🇺🇸 Prelim GDP q/q - USD
🇺🇸 Unemployment Claims - USD
Friday 31st May
🇺🇸 Pending Home Sales m/m - USD
🇨🇳 Manufacturing PMI - CNY
🇨🇦 GDP m/m - CAD
🇺🇸 Core PCE Price Index m/m - USD
AUD-USD 🇺🇸
Rates have had a slight increase over the weekend currently sitting at 0.6634.
(3:30PM AEDT)
AUD-GBP 🇬🇧
Sitting 0.5207 the AUD - GBP has hit a decline which was seen on the tail end of last week.
(3:30PM AEDT)
AUD-NZD 🇳🇿
Has had a mass decline over the past week at 1.0824.
(3:30PM AEDT)
AUD-EUR 🇪🇺
AUD to the EUR has continued the downfall of last week at 0.6115.
(3:30PM AEDT)
These rates reflect the mid-market rate and are current at the time of writing, but subject to change.
Please note that the mid-market rate is the midpoint between the buy and sell prices of a currency in the foreign exchange market. There are many other factors that might impact on pricing and therefore the mid-market rate is not typically the end rate that is offered to consumers by banks or financial services providers. For further information on how Send charges for its services, please see our PDS.
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