After days of lacklustre trade, the relative calm in the Australian dollar looks set to come to an end on Wednesday with a mountain of important economic data from both home and abroad set to be released.
Oh, and Donald Trump will deliver what is likely to be perceived to be the most important speech for financial markets this year when he addresses the US Congress midway through the Asian session.
It’s going to a be a big session for traders.
Here’s the scoreboard as at 7.50am AEDT.
- AUD/USD 0.7663 , -0.0008 , -0.10%
- AUD/JPY 86.09 , -0.35 , -0.40%
- AUD/CNH 5.2514 , -0.0121 , -0.23%
- AUD/EUR 0.7231 , -0.0013 , -0.18%
- AUD/GBP 0.6178 , 0.0014 , 0.23%
- AUD/NZD 1.0639 , -0.0023 , -0.22%
The AUD/USD is currently trading near its session lows following remarks from San Francisco Fed president John Williams that a rate increase from the Fed is now up for “serious consideration” when the FOMC meets later this month.
That’s seen the AUD/USD fall from highs of .7694 struck earlier in the session.
Today, there are potential risk events scattered throughout the session, culminating with Trump’s speech that will begin at 1pm AEDT.
“Markets appear to accept that president Trump will not provide much details regarding tax changes in the State of the Union address today. So the USD should not show a lot of reaction to the speech but an adverse reaction is the risk if Trump disappoints by providing few tax plan details,” says Joseph Capurso, senior currency strategist at the Commonwealth Bank.
This primer from the Business Insider team in New York has all the details on what to look for in Trump’s address.
Before that event arrives, a series of major economic data reports will also be released, potentially creating short-term volatility in the Aussie as trading volumes dry up ahead of Trump’s speech.
In Australia, the main event will be the release of December quarter GDP at 11.30am AEDT. After contracting by 0.5% in the September quarter, the largest decline since the GFC, markets expect growth to rebound strongly today with a quarterly increase of 0.8% eyed.
This 10-second guide has all the details on what to expect.
Prior to the GDP release, Australian manufacturing PMI and house price data for February will be released at 9.30am and 10am AEDT respectively.
While not noted market movers, the latter may garner some attention given recent strength in the Sydney and Melbourne housing markets, the largest and most expensive in the country.
Outside of Australia, a swathe of manufacturing PMI reports will be released in Asia, including from China.
The China manufacturing PMI is expected to print at 51.1, down from 51.3 in January. The nation’s non-manufacturing PMI report for February — including information on construction activity — will also be released.
They’ll both arrive at midday AEDT.
The PMI deluge will continue later in the session with readings from Germany, France, the eurozone, UK and US all scheduled for release.
Elsewhere, German unemployment and inflation data will be released along with personal income and consumption figures, core PCE inflation and construction spending from the United States.
Rounding off the session, the Bank of Canada will also deliver it’s latest interest rates decision. No change is expected.