Today’s Key Market Drivers – 15th August 2017
US tensions with North Korea seem to be subsiding and therefore the safe haven currency positions that were bought late last week have been unwound seeing most base currencies against the Yen and Swiss Franc gain on Monday.
Global stock indexes also rallied with the US Dow Jones having its best one-day rally in more than 8 weeks. The US Dollar however still remains out of favour with investment banks and hedge funds with the Commodity Futures and Trading Commission reporting on Friday that net short positions on the US Dollar have increased to the largest in 4 years. Any potential interest rate increase at the US Federal Reserve is already priced into the US Dollar and the only real potential surprise may come from when the Fed announces when and how it will unwind its trillion dollar balance sheet it accumulated between 2009 and 2014.
The Euro has been the stand out performer over the past 6 months with traders banking on the ECB will reduce its current stimulus program in coming quarters and potentially begin to raise the official cash rate from 0% by mid-2018. The ECB’s July monthly minutes are due on Thursday, which may give traders a better understanding of when the committee will reduce the ECB’s giant artificial money printing program.
The monthly minutes from the RBA will be released today at 11.30am, which will give traders a better idea of what the committee discussed at its recent monthly board meeting. The AUD will likely get some attention at 11.30am so keep an eye on your positions. The European trading session sees the release of German 2nd quarter GDP data, which has the potential to move the Euro higher if Germany’s economy expanded at more than the 1.9% economists expected. UK CPI will be important for the Pound when its released at 6.30pm AEST and in the US trading session, the US Dollar will feel the impact of the latest US Retail Sales data.
About the Author: Andrew Barnett
Andrew is a professional trader and successful investor who has a strong focus on education. He is a regular Sky News Money Channel Guest and one of Australia’s most awarded and respected financial experts, and is regularly contacted by the Australian Media for the latest on what is happening with the Australian Dollar. Director at LTG GoldRock, Andrew Barnett, guides thousands of traders around the world in the live market on a daily basis, advising them on buy and sell directions, as well as trading his own personal account. Andrew, a regular key-note speaker at trading and wealth-creation events throughout the Asia Pacific region, is an authorized representative registered with the Australian Securities and Investment Commission (ASIC).
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