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Global Market Update
The View from Australia

Craig Killaby September 11, 2019



> AU September Westpac Consumer Sentiment : -1.7% v. 3.6% Prev.

> US August PPI & Core PPI : 0.1% & 0.3% v. 0.0% & 0.2% exp.

> US EIA Crude Oil Inventories : -6.9M v. -2.9M exp.


Overnight Headlines (BBG)


>  President Donald Trump urged the Federal Reserve to lower interest rates to a level typically reserved for recessions or periods of persistently weak growth

>  China unveiled a list of tariff exemptions, easing trade tensions


What you need to know


Optimistic signs for the Aussie, as it was able to hold up despite the strong Dollar session amidst an ease of geopolitical tensions and some positive signs in the trade war. The AUD looked poised to fall following a miss on the some consumer sentiment numbers, however news that China will unveil some tariff exemptions erased losses and saw the pair rally. Eventually the AUD hit an intraday high of 0.6885, as Trump has moved to ease sanctions on Iran and schedule a meeting with the Iranian President. In Europe, the EURUSD was under pressure as the market eagerly looks ahead to this evening’s ECB decision. The ECB is expected to release new stimulus to offset the lagging growth in the Eurozone and Brexit unrest, likely pushing the EURUSD lower yet again tonight. US equity markets finished the day well on the news of Chinese tariff exemptions, up 0.7%. UST yields continue to edge higher as the global uncertainty that was prevalent in August subsides. Oil the biggest story in commodities, with the news of US/Iran relations blossoming putting supply glut fear in the forefront down over 3%.


The Day Ahead




> EU ECB Rate Statement & Press Conference : 0.00% exp.

> US August CPI & Core CPI : 0.1% & 0.2% exp.

> US Unemployment Claims : 215K exp.


The data docket for the week peaks today with the ECB decision the major highlight ahead of US consumer inflation numbers. With markets expecting more stimulus, the risk of a disappointment is definitely there, however with Super Mario’s reign coming to an end soon will he elect to deliver on what the market believes? Significant EURUSD weakness the price action likely on an ECB delivery. There is very little on the docket in APAC today, with investors likely staying on the sidelines ahead of the ECB tonight. Long AUDEUR a possible winning trade here.


Range for the day : 0.6850 – 0.6910


AUD/USD Technicals


Rinse and repeat for the pair as the new range below the 0.6900 handle continues to hold true below the 55DMA. Same downside levels as yesterday with 0.6801 and 0.6764 holding up the pair. A break and hold above 0.6879 leaves the door open for a push to 0.6910.


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