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CAFX Market Update 12/07/2022

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

Australia                   – Westpac Consumer Sentiment (Jul)
NAB Business Confidence (Jun)

Macro Report

The US dollar continues to climb against its peers, pushing to fresh yearly highs ahead of the greatly anticipated US Consumer Price Index (CPI), which is expected to increase for ten consecutive months. Despite the dollar demand, the US 2-year Treasury yield dropped 3 basis points but remained above the 10-year yield, which fell 10 basis points.

Stocks sank, with the S&P 500 and NASDAQ falling 1% and 2.25%, respectively. Commodity prices, including oil, are under pressure, and gold has declined to 10-month lows at the $1730USD per ounce level.

The AUD/USD currency pair extends losses after being pushed down firmly below the 68-cent level as safe-haven flows drive the dollar. The difference in approaches between the Federal Reserve and the Reserve Bank of Australia (RBA) may mean the pair will continue on its downward trend while the RBA plays catch up. This decline may dampen retail sentiment in the coming months, with consumer confidence waning. Today’s Westpac Consumer Confidence index for July could bring more undesirable news, considering its print of negative figures since December 2021.

AUD/USD Daily Chart

DXY (USD INDEX) Daily Chart

Major Global Markets 

Currencies Level Change (%)
AUD/USD 0.6736  0.09
AUD/JPY 92.5280 -0.03
AUD/CNH 4.5216 -0.02
DXY 108.02 -1.49
Rates Yield (%) Change
US 10 Year 2.995 -0.105
Aus 10 year 2.517  0.032
Equities Level Change (%)
S&P 500 3854.43 -1.15
NASDAQ 11372.60 -2.26
ASX 200 6602.20 -1.14
Commodities Level Change (%)
Iron Ore 115.00  0.44
Gold 1731.6 -0.52
Brent Crude oil 107.10  0.07