One dollar and 10 cents in Australian currency sit atop a U.S. one dollar note in this photo illustration taken in Sydney July 27, 2011.
One dollar and 10 cents in Australian currency sit atop a U.S. one dollar note in this photo illustration taken in Sydney July 27, 2011. Reuters/Tim Wimborne

Bell FX Currency Outlook: The Australian Dollar touched a three-week high last night as commodities rebounded.

Australia: The AUD is currently trading around 0.7080, slightly off last night’s high of 0.7129, but up 0.8% for the session. The currency was boosted by oil prices reaching the highest level since 6 January following
production cut headlines from Saudi and Russian officials, while the USD was also on the back foot following disappointing durable goods data (see below). Yesterday’s import/export price index had little impact on the AUD, with import prices down 0.3% and export prices down 5.4%. Coming up today we have Australian private sector credit and PPI data both released at 11:30 AEDT, while offshore Japan CPI and the BOJ meeting will be keenly watched with the possibility of further easing in Japan.

Majors: As stated above, US durable goods data for December disappointed, plunging 5.1% on the month. Yesterday’s FOMC statement alluded to the economy softening towards the end of last year and it downgraded its assessment of capex. So the policy implications from this release offer little new information, but it all adds up to a Fed on hold for now. Also released last night, US pending home sales held steady in
December, up 0.1% m/m, (and below the 0.9%), while jobless claims decline to 278k from 294k. GBP is at the top of the G10 leader board, boosted by a solid Q4 GDP print (0.5% q/q as expected), while the JPY was the only currency to underperform the USD, with expectations of further easing from the BoJ today. Tonight Europe releases preliminary inflation statistics (January) for France, Spain and Germany along with
monetary aggregates for the Eurozone. And later in the US we’ll get the first estimate of US Q4 GDP on Friday.

Economic Calendar 29 JAN

  • AU RBA credit MoM/YoY
  • JN BOJ Annual Rise in Monetary Base
  • EC CPI Core YoY
  • US GDP Annualised QoQ

Bell Fx

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