Aussie Sustained Despite RBA Leaving OCR Unchanged, Greenback A Little Softer

Market Reviews

Greenback has slightly weakened, but stayed the firmest currency for this week. Kiwi declined ahead of RBNZ rate statement. Reserve Bank of Australia once again stood pat, keeping the OCR at 1.50%, but Aussie didn’t seem to be bothered. DOW rose 0.16% at 25502.18. S&P 500 grew 0.35% at 2850.40. NASDAQ was up 0.61% at 7859.68. 10 year yield declined -0.015 at 2.938. As of Asian stocks, China’s Shanghai SSE increased 1.56% to 2747.38. Hong Kong HSI is up 1.0%. Nikkei surged 0.61%. Singapore Strait Times lifted 1.55%.

Reserve Bank of New Zealand is going to announce its rate decision in 2 days. Economists expect no rate hike. Policy is likely to remain accommodative. GDP growth is projected to be revised down. In UK, support for Theresa May in Brexit has reached its new minimum this month, as it was reported in the latest monthly Brexit Confidence Tracker by ORB International. Only 24% of surveyed accepted May’s way to deal with separation from the EU, way lower than 40% in April. The disapproval soared to 76%. Only 22% are confident that the PM will manage to get the requested Brexit deal.

Japanese nominal labor cash earnings grew 3.6% yoy in June. Real wages rose 2.8% yoy, marking the fastest pace in 21 years. Regular pay was up 1.5% yoy. One-off payment including bonuses increased 7.0% yoy. Overtime pay surged 3.5% yoy. Overall household spending reduced -1.2% yoy in June. British BRC retail sales monitor edged higher by 0.5% yoy in July. Australia AiG performance of construction index lifted from 50.6 to 52.0 in July.

Today, Germany will release trade balance and industrial production, Swiss will feature foreign currency reserves, UK will present Halifax house price and Canada will publish Ivey PMI.