Finport Currency Brief - Courtesy of Compass Global Markets.
The Australian Dollar held firm at important technical lows as doubts surface over US tax reforms and as a member of the Federal Reserve suggested their interest rates should stay lower for longer. This outweighed some weaker than forecast Chinese data, but which still showed their Industrial production chugging along at more than +6% a year.
Focus now turns to US inflation and retail sales numbers that are expected to reflect a decline in both sectors and therefore maintain the support the A$ currently enjoys. This could also mean the start of a grind higher to the middle of the recent range, ahead of our local Unemployment data due tomorrow.
Our medium-term target is 0.80c as long as current levels hold and we have seen a steady increase of sizeable market orders for forward contracts placed at those September highs.
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