Australian dollar coin
A one Australian dollar coin is seen in this picture illustration taken in Sydney, Australia, July 29, 2015. Reuters/David Gray

Bell FX Currency Outlook: The Australian Dollar is the top performer up 0.45% followed closely by the NZD +0.44% and the CAD at +0.14. JPY was the biggest loser at -1.17% with CHF down -1.05%.

Australia: In Australia this morning we get the weekly reading on consumer confidence followed by RBA minutes from their February meeting. While the minutes will be scanned for the potential of any new hints on what the RBA is thinking, we know from Friday’s RBA Governor Stevens parliamentary testimony that the Bank is currently watching international markets and economic events very closely. They are still fairly calm about the current state and momentum in the domestic economy and the hurdle for any near-term rate cut remains high.

Majors: The US is back from its long weekend holiday with the Empire Manufacturing survey (Feb) and NAHB Housing Market Index the two data highlights for Tuesday. The Empire survey should provide the first
February look into the manufacturing sector in the US. ECB President Draghi at a European Parliamentary hearing last night reiterated that the Bank is still on target to “review and possibly reconsider the monetary policy stance" at its next meeting on 10 March. Meanwhile a call for a rate rise is less compelling according to BoE’s McCafferty. “Upside risks to wages haven’t disappeared but have been pushed further out”. BoE is not
out of ammunition if it needs to stimulate the economy in case of downturn. Use of negative rates is a possibility, but it would depend on economic circumstances. Still expects next rate move to be up. Yesterday’s lower CNY fix (196 pips) helped USD/CNY trade sub 6.5 for the first time this year and was a source of stability for the region.

Economic Calendar 16 FEB

  • AU RBA Feb Meeting Minutes
  • UK CPI Jan
  • GE ZEW Survey Feb
  • US Empire State Manufacturing Index Feb

Bell Fx

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