Australian dollar notes and coins can be seen in a cash register at a store in Sydney, Australia, February 11, 2016.
Australian dollar notes and coins can be seen in a cash register at a store in Sydney, Australia, February 11, 2016. Reuters/David Gray

Bell FX Currency Outlook: The Australian Dollar consolidated overnight ahead some important data releases tonight.

Australia: After a quiet day in Asian trading the AUD pushed higher into the European session. The currency briefly breached the 77 cents level but was unable to hold onto these gains and is back around 0.7660 against the USD. Yesterday’s private sector credit data had little impact on markets. Credit growth in February was marginally above market expectations. Housing credit growth remained steady but has moderated a little in recent months. Business credit growth remains much stronger than the experience of the past few years, though commercial loan approvals have softened in recent months. Today the Council of Australian Governments (COAG) meeting in Canberra will focus on a new proposal from the Government – income tax sharing. With reports that most State heads are opposed to the idea, and with little detail on offer, it is unlikely that much will get done today. There are no major data releases today in Australia but in Asia we have the BoJ’s Q1 Tankan report, followed by Chinese official manufacturing and non-manufacturing PMIs, as well as the Caixin manufacturing PMI. Then it is all eyes ahead to ‘Super Friday’ in the US, with several key data releases, including non-farm payrolls.

Majors: The USD remained under pressure overnight, supporting commodity prices, with WTI and Brent crude oil and gold rising. The Eurozone core CPI for February rose to 1.0% from 0.8% and a little above the 0.9% expectation. In the hour or two after its release, the EUR/USD tracked up to and tested 1.14, before consolidating just below the figure, where it sits this morning. Likewise, a modest upward revision to UK December quarter GDP provided an excuse to buy GBP as it pushed above 1.44, also before consolidating. As stated above, it is a big night for data releases. In Europe there are the preliminary PMIs for a number of nations ahead of the big double in the US: payrolls and the US ISM Manufacturing report. US payrolls will continue to demand global attention with the Fed on the lookout for whether the global risks that spooked the FOMC in March have affected the labour market. The market is looking for headline payrolls growth of 205K and an unemployment rate of 4.9% with the Manufacturing ISM expected to poke its head back above 50 at 51.0, up from 49.5.

Economic Calendar 01 APR

  • US Nonfarm Payrolls Mar
  • US ISM Manufacturing / New Orders Mar
  • US Fed’s Mester (VM) Speech New York
  • CH Manufacturing / Non Manufacturing PMI Mar

Bell Fx

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