Australian twenty dollar notes
A sheet of uncut Australian twenty dollar notes are displayed at the Reserve Bank of Australia in Sydney, October 28, 2008. Reuters/Tim Wimborne

Bell FX Currency Outlook: Ahead of the Easter holiday, overnight markets were subdued with recent ranges prevailing.

Australia: RBA Governor Stevens speaks at the ASIC Forum (at 4:15pm AEDT), with the topic likely to be along the lines of Australia’s ability to withstand a major global shock. The AUD/USD is currently trading just under 0.7600, it is up over 10% since it reached a low of 0.6827 in mid- January and it is 4 cents above the level where RBA Board Member John Edwards recently noted that the currency was still a “bit too high”. Given the sense of market anticipation, if the Governor passes on the opportunity to talk the currency lower, this could be the catalyst for the AUD to move another leg higher. In Australia this morning we get the weekly consumer confidence reading and the ABS releases its own measure of house prices.

Majors: The USD has continued to recover some of its lost ground post the FOMC announcement last week. Comments by the Fed’s Lacker, Lockhart, and Williams (all non-voters) overnight suggest low inflation will not be a barrier to US rates moving up. Politics remains the key driver with GBP under pressure as cracks appear in the Tory party, with the resignation of Iain Duncan Smith on Friday, a senior member of the UK government and pro-Brexit supporter. The Confederation of British Industry (CBI) said Brexit would cost the economy GBP100bn and about 1 million jobs, although the CBI trends series showed the expected uplift in activity.

Economic Calendar 22 MAR

  • AU House Price Index Q4
  • AU RBA’s Stevens Speaks at an ASIC Forum in Sydney
  • EC Markit Manufacturing/Services PMI Mar
  • US FHFA House Price Index Jan

Bell Fx

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