US Data in the Spotlight | Go Markets Daily FX Commentary

• Aussie pushed lower in absence of local data and strong US numbers;
• Sterling remained under pressure despite stronger mortgage approvals;
• Greenback continues to climb higher after ahead of FOMC statement this evening.

In the absence of local data, the Aussie dollar sought direction from overseas, gaining 15 points in early trade however failed to maintain $0.94 as we moved into the afternoon session. Weighing on the Aussie was a call from Goldman Sachs that the RBA may have no choice but to cut rates towards the end of the year, citing a lack of domestic growth and expectations of a fall in inflation by the end of the year. With little to follow throughout today’s Asian session, markets brace for what is set to be an eventful evening with key releases from the US and Eurozone.

A downward trajectory continued for the pound yesterday, despite news that mortgage approvals beating expectations in June. A slowdown in property prices has weighed on the pound in recent weeks as the Bank of England debate the time frame in which to raise interest rates, many institutional investors slashing bets that a hike is forthcoming at the end of this year. There is little data from the UK this week that could turn the fortunes of Sterling and any bounce will be reliant on weakness in data from across the globe.

A stronger greenback has been the theme for some time now as the US economic outlook improves and data suggests a rate hike could be due in the first half of next year. Stronger consumer confidence data overnight saw the greenback trade higher against most counterparts ahead of a busy docket this evening commencing with ADP employment data and highly anticipated GDP. The subsequent release of bond purchases pace combined with a statement from the FOMC is to lead trade into the early hours of the Australian morning.

[B]Tom Williams
Sales Trader[/B]