Australia
A busy week for the Australian market with all eyes on today’s RBA Cash Rate and Statement at 2:30PM (AEDT). Recent figures would suggest the RBA should retain their hold/easing bias – a shocking GDP figure from Q3, plus weak annualised core CPI of 1.6% (well outside of the banks’ target 2-3%), not to mention yesterday’s negative retail sales, the first since September 2015. Today’s Statement is the one to watch, as it will hold the keys to the RBAs leaning. Further to this, Fridays Quarterly Monetary Policy Statement will provide a macro view of the banks thinking.
The AUD/USD has had a positive start to the year, gaining around 5 cents. In more recent trading sessions taking the elevator up and the stairs down, as US dollar weakness, weak NFP internals and a strong Aussie Trade Surplus have provided strength to the pair. Again, traders’ eyes are expected to be on today’s Rate Statement for clues on the AUD/USD direction.
U.S.
The US market continues to focus on Trump Policy. First immigration then Trade Policy and now overnight traders showed concern that Donald Trump and Congress will likely encounter delays when implementing a highly anticipated fiscal stimulus.
U.S. Treasury prices appreciated Monday night, pushing the benchmark 10-year note yield lower to 2.419 percent and the short-term two-year note yield to 1.161 percent. Gold prices also rose, with futures for April delivery gaining $11.30 to settle at $1,232.10 per ounce.
Europe
Political instability in France saw French 10 year bond yields climb overnight to a 17 month high as elections loom, with the target of some politicians a French Exit from the EU – aka ‘Frexit’.
A snapshot of developed countries current interest rates
