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Global risk aversion sentiment off of U.S.-China trade headlines and a net dovish updates from Australia had the Aussie spending most of the week in the red against the other major currencies.
Australian Headlines and Economic data
Monday:
- No major Australian catalysts for the Aussie to start the week, which means the broad move lower in the Aussie against the majors was influenced by broad risk sentiment. This was likely on reports of a pessimistic mood from Beijing on U.S.-China trade negotiations bringing global risk sentiment down into negative territory.
Tuesday:
- RBA Meeting minutes: RBA seriously considered November rate cut – this consideration for a rate cut apparently took traders by surprise as evidenced by the spike lower in the Aussie after the event.
- RBA: There was a case to wait and assess the effects of previous stimulus
Wednesday:
- Australian leading index remains cratered, combined with global risk sentiment leaning negative after reports that the Phase One U.S.-China trade deal may not be completed this year, was likely the reason we saw a bearish lean in the Aussie against the majors on the session.
Thursday:
- The Aussie stabilized on the session as global risk sentiment turned towards the positive, likely on a combination of China’s top negotiator sounding ‘cautiously optimistic’ about reaching trade deal and China inviting U.S. trade negotiators for new round of talks.
Friday:
- Australia’s Markit flash services PMI down from 50.1 to 49.5
- Risk sentiment shifted positive during the U.S. trading session, likely supporting the Aussie in the process, after a combination of better-than-expected U.S. business sentiment (U.S. Composite PMI Business activity growth quickens in November) and consumer sentiment.