Free Trial
CANADA

CAD Sees Modest Outperformance On Local Holiday

USD

Broader base buying going through

CROSS ASSET

USD is pushing higher

Real-time Actionable Insight

Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.

Free Access

A$ Following Global Drivers

AUD

A$ correlations have remained elevated over the past week. This is evident across yield spreads, particularly at the short end, as well as with global commodities and equity trends.

  • The table below plots correlations for the past week and month across these traditional key macro drivers.
  • The yield spread correlation has likely remained elevated given US moves post the CPI print/Fed commentary this week. Note next week contains some important AU event risks, RBA minutes are out Tuesday, followed by Q2 wages on Wednesday. Then on Thursday is jobs data for July. The wages/jobs mix arguably carries the most domestic risk that can shift the AU yield outlook.
  • The correlation with global commodities remains strong, as it was last week, but less so iron ore, where prices have been more range bound, while the A$ has continued to rally this past week.
  • The currency is also back in lockstep with global equity sentiment, see the chart below, after a brief divergence through early August.

Table 1: AUD/USD Correlations

Keep reading...Show less
229 words

To read the full story

Why Subscribe to

MarketNews.com

MNI is the leading provider

of news and intelligence specifically for the Global Foreign Exchange and Fixed Income Markets, providing timely, relevant, and critical insight for market professionals and those who want to make informed investment decisions. We offer not simply news, but news analysis, linking breaking news to the effects on capital markets. Our exclusive information and intelligence moves markets.

Our credibility

for delivering mission-critical information has been built over three decades. The quality and experience of MNI's team of analysts and reporters across America, Asia and Europe truly sets us apart. Our Markets team includes former fixed-income specialists, currency traders, economists and strategists, who are able to combine expertise on macro economics, financial markets, and political risk to give a comprehensive and holistic insight on global markets.

A$ correlations have remained elevated over the past week. This is evident across yield spreads, particularly at the short end, as well as with global commodities and equity trends.

  • The table below plots correlations for the past week and month across these traditional key macro drivers.
  • The yield spread correlation has likely remained elevated given US moves post the CPI print/Fed commentary this week. Note next week contains some important AU event risks, RBA minutes are out Tuesday, followed by Q2 wages on Wednesday. Then on Thursday is jobs data for July. The wages/jobs mix arguably carries the most domestic risk that can shift the AU yield outlook.
  • The correlation with global commodities remains strong, as it was last week, but less so iron ore, where prices have been more range bound, while the A$ has continued to rally this past week.
  • The currency is also back in lockstep with global equity sentiment, see the chart below, after a brief divergence through early August.

Table 1: AUD/USD Correlations

Keep reading...Show less