Current Sentiment

Current Sentiment:
Yesterday’s NY session saw US Empire State Manufacturing come in at its lowest level since April 2009. The dollar saw weakness in the hour or so afterwards but then gained later in the session; Cable fell 110 pips after failing a test of the 1.5689 August high. Overall the session was quiet which is typical for a Monday with no fundamental catalyst.

During Asia, the RBA released the minutes from it’s policy meeting that took place earlier this month. At that meeting the cash rate remained unchanged,as expected, at 2%. The minutes contained no real surprises, the RBA said that economic data would be a guide to determine if it’s current policy stance is appropriate. It noted that accommodative monetary policy remained appropriate given current forecasts. It also stated that “inflation was expected to remain consistent with the target over the forecast period”.

Outside of the domestic picture the RBA said “the downside risks to the outlook for Chinese growth identified over the past year had receded somewhat,” and that “Uncertainties arising from the expected start of monetary policy tightening in the United States had moved into sharper focus”. The AUD has remained relatively unchanged since the release.

The NZD has continued to strengthen ahead of today’s Global Dairy Trade auction. ANZ bank stated that “Dairy prices are expected to find a floor this week and the NZD may follow, but there is a long way to go before the beleaguered dairy sector can breathe easy”.

Today for the London session we have UK inflation data, followed by US Building Permits, US Housing Starts, and the GDT auction later after the NY open.

Trade Call:
There is no opening trade call as we await UK inflation data for potential opportunities.

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Source:: Current Sentiment