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After a bit of time in the red to start the week, the Aussie managed to ride the wave of positive global risk sentiment higher, as well as fall with it on Friday to end the week on a net negative note.
Australian Headlines and Economic data
Monday:
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- A quiet Monday session from Australia but we saw some uniform weakness in Aussie pairs, likely on a slight negative global risk sentiment tone after headlines from China that included:
Tuesday:
- RBA Governor Lowe: Australian GDP outcome mostly as expected
- Australia’s Q3 HPI up 2.4% from earlier 0.7% drop, 0.5% consensus
- Australian NAB business confidence index slipped from 2 to 0 in Nov
- Global risk sentiment starts to improve for the week on speculation that the U.S. and China are planning to delay the December tariffs, correlating with bottoming out of the Aussie on Tuesday and slow grind higher into Wednesday.
Wednesday:
Thursday:
- Australia’s MI inflation expectations index unchanged at 4.0%
- Big jump in positive global risk sentiment during the afternoon U.S. trading session to rally the Aussie higher after Trump Signs off on China trade deal to avert December tariffs. The big Conservative Party win in the U.K. general elections likely brought in some risk-on sentiment as Brexit uncertainty waned, but the Aussie did fall big against Sterling on the event.
Friday:
- A little bit of pullback in global risk optimism (and the Aussie) as details of the newly formed U.S.-China trade agreement were a little bit disappointing (only 50% of the $112B in tariffs would be rolled back and China agreed to buy $32B in additional agricultural goods over the next two years, conflicting with Trump’s claims of $50B in agricultural purchases. A nice bump higher off of the news for the yen, but not enough to take it out of the red against any of the major currencies.
