AUD
What started as a hundred-metre sprint has turned into a four hundred-metre hurdle for the AUD, in February this year, the currency was at levels of AUD/USD 0.6300 and the Aussie hasn’t been able to contain itself since.

The week started off the back of poor non-farm payrolls being offset by Goldman Sachs announcing it was bullish on risky assets and with the G7 preferring to ‘not’ criticise USD weakness over the weekend, all positive for the AUD.

Then came Tuesday. The RBA announcement that the overnight cash rate would be increased (25basis points) to get interest rates off the 49 year floor to 3.25% shocked almost all economists surveyed as Governor Glenn Stevens and Co. tightened the country’s monetary policy belt, the first in the G20 to do so.

The RBA board has maintained a hawkish view on the strength of the local economy saying there was no longer a ‘risk of serious economic contraction’. The rate hike boosted commodities, in particular Gold (18month high; $1,063/ounce) and Oil ($71.66/barrel), which both put on weight from USD weakness.

Data wise, the unemployment figure unexpectedly fell for Australia (5.7%), 40,000 jobs were gained rather than the anticipated 10,000 lost, supporting a turnaround in the local economy and the rate hike two days earlier.

Effective stimulus over the long term, which doesn’t detract from private sector growth, unemployment, government debt levels and financial institution stability will be key measures of success for governments and central banks alike. This week however, the Australians took the lead in the global currency movements.

The week ahead in Australia
Tuesday 13th – NAB Business Conditions, NAB Business Confidence.
Wednesday 14th – Westpac Consumer Confidence, RBA Governor Glenn Stevens’ Speech.
Thursday 15th – Consumer Inflation Expectation.

AUDUSD
The pairing consistently tracked higher throughout the week, starting the week at 0.8670 and closing the week at 0.9025 after reaching levels of 0.9080.

The week ahead in the US:
Tuesday 13th – ABC/Washington Post Consumer Confidence.
Wednesday 14th – MBA Mortgage Applications, Import Price Index, Retail Sales, Retail Sales ex Autos, Business Inventories, FOMC Minutes.
Thursday 15th – CPI, Continuing Jobless Claims, Initial Jobless Claims, NY Empire State Manufacturing Index, Philadelphia Fed Manufacturing Survey.
Friday 16th – Net Long-term TIC Flows, Capacity Utilisation, Industrial Production, Reuters/Michigan Consumer Sentiment Index.

AUDGBP
The AUDGBP tracked upwards throughout the week, starting at 0.5430 and then closing the week at 0.5646.

The week ahead in the UK:
Monday 12th – RICS House Price Balance.
Tuesday 13th – CPI, Retail Price Index.
Wednesday 14th – Average Earnings, Claimant Count Rate, ILO Unemployment Rate, Jobless Claims Change.

AUDEUR
This pairing started the week at 0.5925 and closed close to the high on Friday at 0.6140.

The week ahead in the Eurozone:
Monday 12th – Wholesale Price Index (Germany).
Tuesday 13th – ZEW Survey – Economic Sentiment.
Wednesday 14th – Industrial Production.
Thursday 15th – ECB Monthly Report, ECB CPI.
Friday 16th – Trade Balance.

NZD
The NZD started the week performing well off the back of a strong overseas equity market performance, and Finance Minister Bill English has been lamenting over the impact the stronger Kiwi is having on exports calling it ‘quite a challenge’.

The economic data was positive for the recovery in New Zealand with ANZ Commodity Prices (6.8%), NZIER Business Confidence (36) and Credit Card Spending 0.7% all better than expected which helped push the currency higher against the GBP, EUR and USD.

The week ahead in NZ:
Monday 12th – Retail Sales, Business NZ PMI.
Wednesday 14th – Consumer Price Index, Food Price Index.

AUDNZD
AUDNZD started the week at 1.2066 and fell to 1.9280 before the RBA rate decision from where it strengthened to close the week at 1.2210.

GBPNZD
The pairing performed poorly and tracked downwards as the NZD continued to strengthen starting the week at 2.2206 and closing the week at 2.1630, with the low for the week on Thursday at the 2.1460 level.

EURNZD
EURNZD started the week at 2.0344 and weakened to close the week at 1.9899.

NZDUSD
The pairing started the week at 0.7154 and strengthened to close the week at 0.7395.