Today’s Key Market Drivers – 8th September 2017

Up it goes! The European Central Bank has sent the Euro to new highs against the US Dollar again touching 1.20 after the Central Bank confirmed that tapering of its current stimulus program will likely begin in October. The ECB chief did warn that inflation could be impacted by a rising Euro currency and the Governing Council will take this into consideration when considering how much tapering will happen when the taper program likely begins in October.

The AUD v USD is trading well above 0.80c now and is looking like closing a weekly candle above the 200 EMA. This is a very bullish indicator and consecutive weekly closes has not happened since 2009. The US Dollar continues to take a bath against all its rivals with the Dollar Index a gauge of the US Dollar against a basket of 6 major currencies falling to its lowest level in more than 2 ½ years and down 14% against the Euro this calendar year. Any base currency other than the Euro that is rising against the US Dollar is mostly benefiting from a weaker US Dollar not necessarily a stronger local one. The US economy is going to benefit from having a weaker currency and Donald Trump mentioned earlier this year he did not want to see the greenback higher and attempted to talk it down. The US Dollar is simply being sold because traders don’t believe the US Fed will raise rates anytime soon and Trump’s policy agenda to “Make America Great Again” with huge infrastructure programs, tax cuts and stimulus programs won’t likely come to fruition as planned.

Today sees the release of more high impacting news for the Canadian economy with the latest official unemployment figures. The Pound may see some volatility following an inflation report from the BOE at 6.30pm AEST and around the same time, RBA Governor Lowe gives a speech in Sydney that could impact the Aussie Dollar. US markets are in a cautious mood heading into the weekend and will be eager to see if North Korea decides to fire another missile. Let’s hope not.

Have a great weekend!

 

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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