Edit Content

CAFX Market Update 21/09/2022

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

United Kingdom     – CBI Industrial Trends Orders (Sep)

Macro Report

Pressure remains for the Aussie Dollar with the AUD/USD currency pair exposed to a hawkish Federal Reserve. Ahead of the Fed rate call, the DXY US Dollar index gained substantial ground yesterday after upward momentum extended to the 110.00 level.

Meanwhile, the US central bank’s decision may hinder the AUD/USD of material recovery after bottoming below the July low of 0.6681. Markets anticipate a 75-basis point hike tomorrow, with an approximate 20% chance of a super-sized 100-basis point move. In such a case, the US dollar will likely respond with broad gains following a more hawkish fed. However, it could also go the other way if the Fed is perceived as less hawkish than expected.

Also adding to the vulnerable Aussie was yesterday’s Reserve Bank of Australia (RBA) Meeting Minutes. Minutes revealed that the RBA may shift to “normal settings” soon as it approaches the end of its hiking cycle. Given such downbeat statements, the Aussie Dollar may continue to track a downward trend against the US dollar.

Besides pre-hike apprehension, the market’s risk-off mode could also be attributed to concerns surrounding China and Europe.

Amid the current environment, the US 10-year Treasury Yield rose to the highest level since February 2011, at 3.56%. Meanwhile, the AUS 10s has dipped to 3.70% at the time of writing.

AUD/USD Daily Chart

DXY (USD INDEX) Daily Chart

Major Global Markets 

Currencies Level Change (%)
AUD/USD 0.6694  0.07
AUD/JPY 96.0940 -0.02
AUD/CNH 4.7007  0.05
DXY 110.2150  0.44
Rates Yield (%) Change
US 10 Year 3.56  0.072
Aus 10 Year 3.70 -0.045
Equities Level Change (%)
S&P 500 3,855.93 -1.13
NASDAQ 11,425.05 -0.95
ASX 200 6,806.40  1.29
Commodities Level Change (%)
Iron Ore 98.99 -1.48
Gold 1,672.90  0.11
Brent Crude oil 90.62 -1.50