19 Feb 2015
AUD/USD bearish bias for the week ahead – Westpac
FXStreet (Barcelona) - With next week’s Australian data expected to come carry a soft tone, and China remaining on holiday, the bias for AUD/USD remains bearish, notes Sean Callow, FX Strategist at Westpac.
Key Quotes
“Australia’s data drought finally breaks on Wed with Q4 wage costs and construction work done. In the Feb minutes, the RBA viewed “restrained” wages increases as contributing to ongoing low infl ation.”
“On Thu we see a key input to Q4 GDP (4 Mar): actual capex plus investment plans for 2014/15 and the first (unreliable) reading on 2015/16. We expect the overall tone of the data to be soft.”
“The RBA’s Feb minutes surprised by revealing a debate over whether to cut in Feb or Mar. The clear implication is that as of 3 Feb, there was no great urgency to act. This has left pricing for March around 50/50.”
“Lunar new year holidays should help keep commodities in the background, helping AUD/USD in the background. But partial data ahead of GDP should chip away at AUD confidence, while USD should find its footing on the Yellen testimony.”
“Any probes beyond 0.7850/75 should be short-lived, with the bias lower over the week, albeit probably no lower than the high 0.76s.”
Key Quotes
“Australia’s data drought finally breaks on Wed with Q4 wage costs and construction work done. In the Feb minutes, the RBA viewed “restrained” wages increases as contributing to ongoing low infl ation.”
“On Thu we see a key input to Q4 GDP (4 Mar): actual capex plus investment plans for 2014/15 and the first (unreliable) reading on 2015/16. We expect the overall tone of the data to be soft.”
“The RBA’s Feb minutes surprised by revealing a debate over whether to cut in Feb or Mar. The clear implication is that as of 3 Feb, there was no great urgency to act. This has left pricing for March around 50/50.”
“Lunar new year holidays should help keep commodities in the background, helping AUD/USD in the background. But partial data ahead of GDP should chip away at AUD confidence, while USD should find its footing on the Yellen testimony.”
“Any probes beyond 0.7850/75 should be short-lived, with the bias lower over the week, albeit probably no lower than the high 0.76s.”