Currency Wars II; the USD Strikes Back.

Last week the Australian Employment figures amazed investors as the Australian economy produced another astonishing result. The figures came in at 70K jobs created for this month; a 10K improvement on the previous month. This lent some assistance to the AUD; however the rebellion attack was short lived.

US Retail Sales finally jumped into expansionary levels on Friday night; from the last 3-4 months of disappointing retail sales numbers. The figures seem to have arrived with good timing; as US Interest Rate hikes are due this week.

US Consumer Sentiment was a down slightly compared to last month’s release. The figure is still relatively strong when comparing to the same time last year; however this month’s decrease is most likely due to the uncertain effects of this week’s monetary policy decision in the US.

This week, we have a few key releases concerning the Australian economy. The first out will be the Australian Monetary Policy Meeting Minutes. This will give investors another look into the thoughts of the Reserve Bank of Australia. Interest Rate stability is on the minds of both the RBA and investors; and it is expected that those thoughts should be reflected in the minutes – which should assist the AUD.

Wednesday we will have the Mid-Year Economic and Fiscal Outlook for Australia which again should indicate the strength and direction of the Australian economy. Due to an increase in employment levels in Australia, the economic outlook in Australia should look much peachier than the previous quarter.

The US Federal Reserve will agree their rate hike decision Wednesday morning. Currently, there is a 70-80% chance that the much discussed rate hike will occur; this outcome is of concern to investors as the effects on the market are unknown. The US Interest rates have not been hiked in more than a decade; which is the reason for all this concern.

There is a plethora of other release from other countries; however, the market and its investors are only interested in the aforementioned release out of the US.

Until then, we will await the return of the AUD.