News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bearish
Oil - US Crude
Bullish
Wall Street
Bearish
Gold
Bullish
GBP/USD
Bearish
USD/JPY
Bearish
More View more
Real Time News
  • A big day for $Gold Gold spent > than nine months in this bearish channel, building as a bull flag. At the time: - Bitcoin was below $12k - Ethereum was below $400 - Doge was worth about 1/3rd of 1 cent The only true constant is change https://t.co/igOIe9axdf https://t.co/4tzQQzdB0P
  • 🇺🇸 Overall Net Capital Flows (MAR) Actual: $146.4B Previous: $73.7B https://www.dailyfx.com/economic-calendar#2021-05-17
  • 🇺🇸 Foreign Bond Investment (MAR) Actual: $118.9B Previous: $-65.5B https://www.dailyfx.com/economic-calendar#2021-05-17
  • Indices Update: As of 20:00, these are your best and worst performers based on the London trading schedule: FTSE 100: 0.31% France 40: 0.25% Germany 30: 0.16% Wall Street: -0.01% US 500: -0.01% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/2O0aGnwxiF
  • Heads Up:🇺🇸 Overall Net Capital Flows (MAR) due at 20:00 GMT (15min) Previous: $72.6B https://www.dailyfx.com/economic-calendar#2021-05-17
  • Heads Up:🇺🇸 Foreign Bond Investment (MAR) due at 20:00 GMT (15min) Previous: $-65.5B https://www.dailyfx.com/economic-calendar#2021-05-17
  • USD/JPY continues to pullback from the monthly high (109.79) to largely mirror the recent weakness in longer-dated US Treasury yields. Get your market update from @DavidJSong here:https://t.co/fv1jjcufMX https://t.co/RQrkxYSsG7
  • Gold continues to climb as US real yields maintain their decline $XAUUSD https://t.co/M8GH93UvoL
  • Commodities Update: As of 18:00, these are your best and worst performers based on the London trading schedule: Silver: 2.72% Gold: 1.24% Oil - US Crude: 0.02% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/LEuM2UyMpc
  • Canadian #Dollar Forecast: $USDCAD Seven-Week Plunge Searches Support - https://t.co/XW5aHqivhu https://t.co/rrZtho7V70
Australian Dollar Gets Double Data Hit From CPI, China PMI

Australian Dollar Gets Double Data Hit From CPI, China PMI

David Cottle, Analyst

Australian Dollar, CPI, Chin PMI, Talking Points:

  • Australian inflation came in a little weaker than expected in the third quarter
  • Its annualized deceleration was expected, but still psychologically significant
  • Chinese manufacturing underwhelmed too, and is now only just expanding as a sector

Fourth-quarter technical and fundamental forecasts from the DailyFX analysts are out now.

The Australian Dollar took a hit Wednesday from domestic and Chinese data which both came in weaker than expected.

China’s official manufacturing Purchasing Managers Index for October was 50.2, below both the 50.6 forecast and September’s 50.8. In the logic of PMIs any reading above 50 signifies expansion for the sector in question, so Chinese makers are only in that zone by a whisker on current evidence. Moreover, October provided the weakest print since July 2016, and suggests that US trade tariffs are taking their toll.

The non-manufacturing PMI also slipped from October, but it was perkier at 53.9. AUD/USD slipped on the manufacturing news, with the Aussie clearly playing its sometime role as liquid China proxy.

One-Two Punch. Australian Dollar Vs US Dollar, 5-Minute Chart

And this wasn’t the first economic release to hit the currency Wednesday. Domestic inflation slowed too.

Official Consumer Price Index data for the year’s third quarter showed an unexpected deceleration. Inflation rose at a 0.4% quarterly rate, below the 0.5% expected. Compared to the same peiod of 2018 the CPI was up by 1.9%, this was as the markets had forecast and below the 2.1% rate seen in the second quarter. This objectively small pullback carries significance, however because it once again takes inflation below the Reserve Bank of Australia’s target band. The RBA is supposed to keep annualized CPI gains between two and three percent over time, and has notably failed to do so this year.

The latest data show that the target remains elusive even with interest rates stuck and record lows and thought likely to remain so for all of this year and next, according to futures markets.

The yawning gap in interest rate expectations between a mired RBA and a consistently tightening Federal Reserve is the key reason for AUD/USD’s clear struggle this year.

Downtrend Entrenched. Australian Dollar Vs US Dolalr, Daily Chart

The Aussie has been sliding for the vast majority of 2018. Wednesday’s reminder of the stubborn weakness of domestic inflation – and the consequent likelihood that interest rates are going nowhere will do nothing to help its battered bulls.

The RBA will set monetary policy for November next week. On current evidence the markets can expect a very dovish performance from Governor Philip Lowe and his colleagues.

Resources for Traders

Whether you’re new to trading or an old hand DailyFX has plenty of resources to help you. There’s our trading sentiment indicator which shows you live how IG clients are positioned right now. We also hold educational and analytical webinars and offer trading guides, with one specifically aimed at those new to foreign exchange markets. There’s also a Bitcoin guide. Be sure to make the most of them all. They were written by our seasoned trading experts and they’re all free.

--- Written by David Cottle, DailyFX Research

Follow David on Twitter@DavidCottleFX or use the Comments section below to get in touch!

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES