dollars
A U.S. dollar note (bottom) is pictured alongside other currencies including (L-R) the Australian Dollar, Singapore Dollar, Korean Won and China's Yuan in this picture illustration taken in Washington, October 14, 2010. Reuters/Jason Reed

Bell FX Currency Outlook: The AUD had a relatively quiet dayon Friday as equity and currency markets were more subdued after the volatility of last week.

Australia: The AUD opens today in the mid .7100’s and later this morningwe will see the latest figures from a raft of indicators that will give us an idea of what our local GDP figures for Q2 will look like on Wednesday when they are announced. Today the latest new home sales, inflation, building approvals, company profits and inventories, private sector credit, and wage figures will be released. Most economists are predicting growthof 0.4% in Q2 GDP. Tomorrow the RBA is expected to not alter the 2% cash rate although the market currently predicts there is a 29% chance of a rate cut while virtualy all commentators predict there will be another cutof 25 bps by the end of 2015.

Majors: Over the weekend the annual symposium for central bankers washeld in Jackson Hole, Wyoming and hosted by the Kansas City branch ofthe US Federal Reserve. The US Fed, ECB and the Bank of England allsee inflation rising in the future and will begin to normalise rates asevidence of that happens. With the comments of all central bankers examined closely the view still remains that US interest rates will increaseby year end with chances of a September rate rise slightly lower than they were a week ago. St Louis Fed President Bullard said that the FOMC will not likely alter its economic outlook because of the recent market volatility in all financial markets. In general, all the major economic indicators continue to show improvement. On Friday, the latest personal spending and income figures for the US for July rose 0.3% and 0.4%, respectively. The core PCE rose 0.1% mom and 1.2% on an annual basis. The final consumer sentiment survey from the University of Michigan for Augustregistered a figure of 91.9, only slightly lower than the preliminary estimateof 92.9. The second estimate of UK GDP in Q2 came in at 0.7% qoq and2.6% yoy which was in line with expectations. Today there is a bankholiday in the UK.

Economic Calendar 31 AUG

  • AU TD Securities Inflation Aug
  • AU HIA New Home Sales Jul
  • AU Private Sector Credit Jul
  • CA Current Account Balance Q2

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