Explore the world.

Assess underlying market conditions and fundamentals in the world's major economies.

World

Stay ahead.

Follow the biggest stories in markets and economics in real time.

Subscribe

Get insight into the latest trends and developments in global currency markets with breaking news updates and research reports delivered right to your inbox.

After signing up, you will receive regular newsletters from Corpay, and may unsubscribe at any time. View Corpay’s Privacy Policy

AUD

Shake, rattle & roll

• Negative vibes. Little progress on US debt ceiling negotiations, ongoing growth worries, & worrying UK inflation data weighed on risk sentiment.• Stronger USD. The backdrop has boosted the USD. Base metals & equities declined. AUD dipped to ~$0.6540, its lowest level since mid-November.• AUD pressure. Except for AUD/NZD, AUD also underperformed on the crosses. More pressure on the AUD expected, but stats show it is entering rarefied air. Another negative night for markets with little progress on US debt ceiling negotiations, growth worries, and some ‘sticky’ inflation data weighing on risk sentiment. Running through the list, the political impasse...

Read More Read More

Cross-Check: AUD/NZD – RBNZ: end of the line

At its May 2023 meeting the RBNZ looks to have delivered its last interest rate hike for this cycle. The 25bp move, which was predicted by most market analysts, takes the Official Cash Rate up to 5.5%, a high since late-2008. And as the chart below shows, following the very abrupt tightening phase which started in NZ in October 2021, interest rates are now well into ‘restrictive’ territory (i.e. above the estimated equilibrium neutral rate). According to the RBNZ rates will need to “remain at a restrictive level for the foreseeable future” to ensure inflation (now 6.7%pa) returns to the...

Read More Read More

US debt ceiling: deal or no deal?

• US debt ceiling. Lack of progress has weighed on risk sentiment. US equities fell overnight and the USD added to its recent gains.• Two-speed economy. Manufacturing PMIs in ‘contractionary’ territory, while services remain robust. The former is a negative for commodity demand & the AUD.• RBNZ in focus. Another RBNZ hike expected today. The debate is around how big it could be (25bps or 50bps)? AUD/NZD is sub 1.06. US debt ceiling negotiations continue to hog the headlines and the lack of progress has weighed on risk sentiment. Equity markets lost ground with the US S&P500 falling by 1.1%....

Read More Read More

US debt ceiling still in focus

• US debt ceiling. Talks are set to restart today. A deal is needed to be agreed quickly given the ‘x-date’ is fast approaching.• Fed pricing. Markets pricing in a chance of a June Fed hike, but are still looking for ~2-3 cuts by January. An unwind of these bets could be USD positive.• AUD holding. Limited local data flow. Global events will drive the AUD near-term. AUD/NZD sub 1.06. Tomorrow’s RBNZ meeting is in focus. It has been a quiet start to the new week with limited moves across markets as participants await the latest round of US debt...

Read More Read More

Dancing on the US debt ceiling

US debt ceiling shenanigans, a repeated source of market volatility over the past decade or so, are rearing their head once again. After tentative progress was made last week negotiations look to have reached an impasse. Reportedly, the Republicans are continuing to push for sizeable reductions in government spending, particularly in areas such as healthcare, education, and housing, while also maintaining high spending on defense and the Trump-era corporate tax cuts. The two sides have agreed to resume talks with President Biden and House Speaker McCarthy set to meet on Monday, but things clearly remain fluid. The clock is ticking...

Read More Read More