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CAFX Market Update 1/12/2022

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

Japan Capital Spending (YoY) (Q3)
Australia Private New Capital Expenditure (QoQ) (Q3)
China Caixin Manufacturing PMI (Nov)
United Kingdom Nationwide HPI (YoY) (Nov)
Eurozone Manufacturing PMI (Nov)
Unemployment Rate (Oct)

Macro Report

The AUD/USD gained overnight, hitting a high of 0.6801 following less-hawkish remarks by Federal Reserve Chair Powell. Fed’s Powell confirmed that the US central bank could scale back the pace of interest rate increases “as soon as December”.

China’s Yuan has extended its gains as risk-asset appetite increases with optimism on the country’s reported looser quarantine measures and reopening. China’s reopening themes has kept the US dollar under pressure while aiding sentiment in favour of the Aussie.

Over in the US, we saw the release of nonfarm payrolls in the early hours, which slowed a considerable decline in job growth from adding 239K in October to 127K this month, increasing far less than expected. However, demand still runs strong, with the total number of open and available positions in the US falling to 10.334 million from a previous 10.687 million figure. Resilience can also be seen in the stronger-than-expected GDP (Q3), which revised up to 2.9% versus an expected 2.7% and prior 2.6%.

The US will publish PCE Price Index data and ISM Manufacturing PMI overnight. Data will be critical ahead of the eighth and final Fed meeting of the year, scheduled for December 14, during which a downshift is expected to result in a modest 50 basis points increase in interest rates.

AUD/USD Daily Chart

DXY (USD INDEX) Daily Chart

Major Global Markets 

Currencies Level Change (%)
AUD/USD 0.6789  0.01
AUD/JPY 93.7520  0.04
AUD/CNH 4.7750  0.03
DXY 105.9870 -0.78
Rates Yield (%) Change
US 10 Yr 3.61 -3.66
Aus 10 Yr 3.46 -1.86
Equities Level Change (%)
S&P 500 4,080.11 3.09
NASDAQ 11,468.00 4.41
ASX 200 7,284.20 0.43
Commodities Level Change (%)
Iron Ore 103.00 2.49
Gold 1,759.90 -0.22
Brent Crude oil  85.43  2.89