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5 Feb 2013
Forex Flash: AUD anchored as overnight sees data bounce – Societe Generale
Kit Juckes, Global Head of Currency Strategy at Societe Generale notes that the overnight session saw a jump in Chinese HSBC services PMI data, a decline in the Australian trade deficit and UK BRC Retail Sales.
However, the main news was that the RBA decided to hold rates at 3%, but left the carrot of further easing dangling in front of the market. He writes, “Short-term rates are still therefore, pricing in some more easing down the road and this will help to anchor the AUD. AUD has completely missed out on the global risk rally in January, and is now likely to re-test of the lower end of its rather dull USD 1.03-1.06 range.”
However, the main news was that the RBA decided to hold rates at 3%, but left the carrot of further easing dangling in front of the market. He writes, “Short-term rates are still therefore, pricing in some more easing down the road and this will help to anchor the AUD. AUD has completely missed out on the global risk rally in January, and is now likely to re-test of the lower end of its rather dull USD 1.03-1.06 range.”