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CAFX Market Update 07/10/2022

Welcome to our daily market update where we help keep you informed on the latest happenings in the world of FX and show you what this means for the Mighty Aussie Dollar.
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

Japan Household Spending (MoM) (Aug)
Australia RBA Financial Stability Review
United Kingdom Halifax House Price Index (YoY)
United States Average Hourly Earnings (MoM) (Sep)
Nonfarm Payrolls (Sep)
Participation Rate (Sep)
Unemployment Rate (Sep)
Employment Change (Sep)

Macro Report

The Aussie dollar took a tumble during yesterday’s trading session on US dollar strength following disappointing trade surplus data, which unexpectedly narrowed on import strength.

The Australian Bureau of Statistics released the Australian Trade balance, which missed the mark posting a surplus of A$8.324 billion versus the expected A$10.100 billion. Monthly imports were up 4.5%, and exports rose by 2.6%. Additionally, Australia posted its AIG Performance of Construction Index, which dropped to 46.5 from 47.9 in August.

Early this morning, the AUD/USD pair bottomed at 0.6388 after retreating further overnight. The pair is currently trading above the 0.6400 level as fragile market sentiment, and the Fed’s reiteration of its hawkish posture continues to benefit the US dollar. Additionally, with the RBA taking the lead on policy loosening, the US and Australian rate differential will only continue to widen and put further pressure on the Aussie dollar.

Today brings several data prints, with the RBA publishing the Financial Stability Review, an assessment of the Australian financial system. Meanwhile, markets are bracing for the all-important US Nonfarm Payrolls. Data is predicted to show a slip to 250k in September from 315K the prior month. Additionally, it is expected that the US unemployment rate will hold at 3.7%.

AUD/USD Daily Chart

Major Global Markets 

Currencies Level Change (%)
AUD/USD 0.6413  0.11
AUD/JPY 92.9930 -0.02
AUD/CNH 4.5367 -1.04
DXY 112.2580  0.94
Rates Yield (%) Change
US 10 Year 3.82 0.067
Aus 10 year 3.85 0.092
Equities Level Change (%)
S&P 500 3,744.52 -1.02
NASDAQ 11,073.31 -0.68
ASX 200 6,817.52  0.03
Commodities Level Change (%)
Iron Ore 95.26  0.00
Gold 1,720.90  0.01
Brent Crude oil 94.85  1.59