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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
AUD
In aggregate, A$ correlations have dipped over the past week. Commodities prices have had the strongest correlation, while yield differential have moved back into negative territory from a correlation standpoint.
- The table below presents the levels correlations for AUD/USD and various cross asset drivers for the past week and month.
- Correlations with yield differentials have dipped. In our last update this was evident in the back end, but the front end remained positive, although this is now in negative territory for the past week. It remains strongly positive for the past month though. The trend in differentials remains against the A$, albeit with a good degree of volatility.
- For commodities, correlations are higher, although more so for aggregate commodities rather than iron ore. Global growth concerns and China's Covid backdrop are likely to remain key drivers of the commodity complex.
- Correlations are lower with respect to global equities and the VIX. The A$ has not enjoyed that much benefit from lower VIX levels, although this may be better reflected against AUD/JPY rather than AUD/USD.
Table 1: AUD/USD Correlations
Source: MNI - Market News/Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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