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Currency Market Analysis

Aug 13, 2020 | Currency Market Analysis

Global Themes

USDSGD slips as US equity strength returns

The USDSGD fell back towards six-month lows overnight. US equities had a strong night with the US’s S&P 500 seeing its best session in more than a month.

The S&P 500 gained 1.4% as it neared all-time highs while the Nasdaq jumped a whopping 2.6% -- shaking off three straight days of losses for the technology-focused index.

The stockmarket’s gains came despite ongoing delays to the long-awaited US government stimulus bill.

The recovery in US shares was mirrored in precious metals markets with gold and silver both recovering from large,

two-day sell-offs.

NZ takes action

The British pound fell after the UK announced the biggest second-quarter GDP loss in the G7. June-quarter GDP fell an incredible 20.4%.

The Japanese yen fell as rising US bond yields boosted the USDJPY.

The New Zealand dollar was lower after the Reserve Bank of New Zealand expanded its money-printing program from NZD60b to NZD100b.

Aussie jobs

The Australian employment report for July is due at 9.30am.

The consensus forecast of 40k jobs is perhaps misleading with the lowest forecast, from Morgan Stanley, looking for a 120k fall while the highest forecast, from Macquarie

Group, is at 150k.

Instead, the wide range is probably an indication that uncertainty reigns in the Australian economy at the moment.

Later tonight, US weekly employment claims will be seen as the major event.

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