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CAFX Market Update 13/07/2022

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

New Zealand              – RBNZ Interest Rate Decision
China                          – Exports (YoY) (Jun)
Imports (YoY) (Jun)
Trade Balance (USD) (Jun)
United States              – Core CPI (MoM) (Jun)
CPI (YoY) (Jun)

Macro Report

The Euro remains stuck at parity with the safe-haven boosted US dollar, as fears grow that the Nord Stream pipeline ferrying Russian gas to Europe will shut down for good. This scenario would lead to the need for gas rationing and risk further sinking the Euro towards a value of 95 cents and breaching parity.

The Aussie dollar held on overnight but remained pressured around multi-month lows on US dollar strength as sour sentiment and global recession stories continue to build.

US Stocks continue to decline amid growing inflation concerns. Commodities also saw a drop as oil prices fell more than 6%, iron ore down by 5%, and gold set a new low at the $1723USD per ounce level.

The Reserve Bank of New Zealand’s rate hike decision is anticipated today, with the consensus predicting a 50-basis point increase bringing the Official Cash Rate (OCR) to 2.5%. Later tonight, the US Labour Department will report the Consumer Price Index (CPI) for June, with estimates that headline inflation, including food and energy, will rise above May’s 8.6% level to 8.8%. This outlook has caused US equities to suffer and the US dollar index (DXY) to rally.

AUD/USD Daily Chart

DXY (USD INDEX) Daily Chart

Major Global Markets 

Currencies Level Change (%)
AUD/USD 0.6752 -0.09
AUD/JPY 92.4440 -0.06
AUD/CNH 4.5437 -0.07
DXY 108.0720  0.05
Rates Yield (%) Change
US 10 Year 2.97 -0.019
Aus 10 year 3.38 -0.029
Equities Level Change (%)
S&P 500 3818.80 -0.92
NASDAQ 11264.73 -0.95
ASX 200 6606.30  0.06
Commodities Level Change (%)
Iron Ore 112.50 -2.17
Gold 1723.70 -0.07
Brent Crude oil 99.49 -7.11