The Australian dollar isn't doing much as traders wait for a bigger event ahead

Alex Wong/Getty Images
  • The Aussie dollar is almost unchanged from where it began the trading week
  • Most traders are waiting for Jerome Powell’s first public appearance as US Federal Reserve Chairman later today
  • There’s a stack of economic calendar released today, especially in the United States

The Australian dollar is largely unchanged from where it began the week, giving back gains achieved in Asian and European trade as traders tweaked positions ahead of Jerome Powell’s first public appearance as Federal Reserve Chairman.

Here’s the scoreboard as at 7.55am AEDT.

AUD/USD 0.7850 , 0.0008 , 0.10%
AUD/JPY 83.92 , 0.09 , 0.11%
AUD/CNH 4.9419 , -0.0188 , -0.38%
AUD/EUR 0.6375 , -0.0004 , -0.06%
AUD/GBP 0.5621 , 0.0008 , 0.14%
AUD/NZD 1.0733 , -0.0023 , -0.21%
AUD/CAD 0.9952 , 0.0049 , 0.49%

After starting the session at .7842, the AUD/USD rose to as high as .7893 in European trade before reversing those gains in North American trade.

As has been the case in recent weeks, that largely reflected fluctuations in the greenback which weakened in Asia before recovering ground latter in the session.

At .7850, the AUD/USD is currently up 0.1% for the session.

AUD/USD Hourly Chart

The choppy price action reflects market uncertainty ahead of Jerome Powell’s appearance before the US House Financial Services Committee later today, his first public appearance as Fed Chair.

“It seems [markets expect] a continuation of what we already know about the Fed and the path [for interest rates] it has set out,” said Greg McKenna, Chief Market Strategist at AxiTrader.

“That much seems clear from the price action in US bonds where the 2-years are back at 2.25% and the 10-years at 2.86%.

“That’s continued to release the pressure on Stocks with the S&P, Dow and Nasdaq 100 all up north of 1%. Likewise the weakness we saw in the US dollar during Asia washed away also with the DXY largely unchanged.”

McKenna says Powell will likely “play a straight bat, or at least try to, but that it will be hard for him not to sound hawkish”.

Powell’s prepared remarks to the committee will be released at 12.30am AEDT. That will be followed 90 minutes later by his appearance before the committee.

Before that event arrives — the undoubted highlight for not only the session but also week in many traders minds — there is a smattering of economic data scheduled for release in Asia and Europe.

Highlights include New Zealand trade data, German and Spanish CPI, Eurozone monetary growth and consumer confidence along with durable goods orders, goods trade figures, house price data, consumer confidence, wholesale inventories and Richmond Fed manufacturing index in the United States.

On the central bank front, the Bank of Korea will hold its February monetary policy meeting — no change is expected — while ECB members Weidmann and Mersch will also be in action.

It’s a busy calendar, although most of it will second-fiddle to Powell’s appearance in Washington.

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