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CAFX Market Update 02/11/2022

Welcome to our daily market update, where we help keep you informed on the latest happenings in the world of FX.
If you have any questions or would like anything further explained, please don’t hesitate to reach out to your account manager or email info@cafx.com

Key Data Being Released Today

Australia Building Approvals (MoM) (Sep)
Home Loans (MoM)
Eurozone Manufacturing PMI (Oct)
United States ADP Nonfarm Employment Change (Oct)

Macro Report

The Aussie dollar witnessed a steep drop yesterday following RBA’s interest rate decision. As projected by markets, the RBA delivered a second consecutive 25 basis point hike, bringing its Official Cash Rate (OCR) to 2.85%.

The central bank’s shift to smaller quarter-point hikes has driven up the interest rate differentials between the US and Australia. With the Fed forecasted to implement another 75-basis point rate hike overnight, the divergence grows and may continue to work against the Aussie dollar.

The AUD/USD pair opened this morning at 0.64557 but has since toppled down to 0.6394 at the time of writing on renewed fed rate hike bets and the return of dollar strength.

With September job opening data releasing better-than-expected figures, odds have increased for the Fed to continue its aggressive tightening path to cool the overall economy and bring down inflation. Job openings increased by 437,000, brining the total number to 10.717 million by the end of September. Additionally, the Institute for Supply Management’s (ISM) Manufacturing PMI printed at 50.2 in October, although better than the forecasted figure of 50.0 and down from prior month’s 50.9, data remains at a two-year low level.

AUD/USD Daily Chart

DXY (USD INDEX) Daily Chart

Major Global Markets 

Currencies Level Change (%)
AUD/USD 0.6394 -0.02
AUD/JPY 94.778 -0.02
AUD/CNH 4.6669 -0.42
DXY 111.4810 -0.04
Rates Yield (%) Change
US 10 Year 4.04 -0.71
Aus 10 Year 3.76 -0.13
Equities Level Change (%)
S&P 500 3,901.06  2.46
NASDAQ 11,102.45  2.87
ASX 200 6,861.90  1.12
Commodities Level Change (%)
Iron Ore 92.43 -0.62
Gold 1,647.96  0.55
Brent Crude oil 94.77  2.11