The AUD underperformed the G10 space, as the RBA surprised by hiking only 25bp. The USD weakened on the day with the DXY down 1.3% and all G10 currencies gained against the USD, except the AUD which was down 0.2%. AUDUSD is now trading at around 0.65.
- AUDNZD fell to 1.1309 overnight but has recovered slightly to 1.134. The RBNZ meets today and is not expected to repeat the RBA’s dovish actions. This could put further downward pressure on the cross. AUDEUR saw a large downward move reaching its lowest since the end of February at 0.6486. It has bounced off that low and is now at 0.6512.
- AUDUSD tested its first resistance of 0.655 early on but couldn’t break through. Technicals still indicate that the AUD is in a bear trend.
- Equity and commodity markets were stronger. S&P 500 +3.1% and the Eurostoxx +4.3%. Oil rose over 3% as some OPEC+ members voiced their support for a production cut of possibly up to 2mbpd. Copper prices were also up overnight, rising 2.7% from the intraday low. Iron ore rose to just over $96.
- S&P Global prints the final September PMIs today. The preliminary release showed activity growing but at a more moderate pace. PMIs for Europe and the US, the US services ISM and ADP employment are scheduled for later.