Australian one dollar coins
A handful of Australian one dollar coins is shown in Sydney, February 18, 2004. Reuters/Tim Wimborne

Bell FX Currency Outlook: The Australian Dollar is trading higher this morning as commodity currencies were given a boost overnight.

Australia: A surge in risk sentiment on Tuesday night saw the AUD rally through USD0.7150 after treading water for much of the day. The AUD recorded a high of USD0.7192 after briefly touching a low of USD0.7109.
Yesterday the RBA left the official cash rate unchanged at 2.0% as widely expected by the market. It maintains that it will continue to watch local and global economic developments but feel comfortable where they currently stand in terms of inflation. Today we have Australian GDP growth figures for Q4, 2015. The market expects a 0.4 q/q and 2.5 y/y Q4 GDP print.

Majors: The USD rose overnight following better than expected US manufacturing data which reassured investors about the state of the economy and increased chances that the Federal Reserve will raise interest rates this year. The February reading saw a rebound to 49.5 vs 48.5 and although it remains in contractionary mode, this was the second consecutive monthly gain so the data was seen as positive for the US economy. The better numbers have come on the back of a string of weaker than expected manufacturing reports which had investors wondering whether or not the US economy was strong enough for the Federal Reserve to raise rates this year. It’s a relatively quiet night in terms of data released offshore. The Fed releases its Beige book, while
Fed Official Williams speaks in LA.

Economic Calendar 02 MAR

  • AU GDP SA QoQ/YoY
  • US ISM New York
  • US U.S. Federal Reserve releases Beige Book
  • EC ECB’s Coeure speaks in Frankfurt

Bell Fx

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