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■ The AUD/USD pair danced a tight waltz around 0.6440 last night. Tonight’s US payrolls report will be the puppet master for this currency duo. Come Tuesday, all eyes will be on the RBA’s policy pow-wow – the next big local shindig for the Aussie dollar.
■ Uncle Sam’s greenback took a breather, dipping below 105.8 points. Treasury yields and stocks played a game of musical chairs. Brent crude had a wild night, now sitting 0.4% lower than yesterday’s perch. OPEC+ decided to keep the oil taps tighter for another quarter, pushing their production cut reversal to April 2025. They’re also easing off the gas, slowing the unwinding to 120K barrels daily, down from the previous 180K plan.
■ The Fed Funds futures market is flirting with a 70% chance of a 25bp rate trim at the December 19 FOMC shindig. Tonight’s jobs report (12:30 am Sydney time) could be a game-changer. After October’s weather-and-strike-induced stumble, payrolls are expected to come roaring back.
■ AUD/JPY took a breather around 96.8. BoJ’s Toyoaki Nakamura played it cool on inflation and wage growth, emphasizing a careful approach to monetary policy tweaks. Markets initially read this as dovish, but Nakamura later clarified he’s not anti-rate hike. The BoJ rate hike rollercoaster continues – odds for a December 19 hike are back up to 70% after Wednesday’s nosedive to 30%. Another strong showing in Japanese wages could reignite hike hopes and push AUD/JPY down (11:30 pm London time).
Here are the latest mid-market rates:
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