The USD is relatively lat

Markets Bounce as Lowe Speaks

Posted Friday, August 9, 2019 by
Rowan Crosby • 1 min read

Stock markets bounced back hard last night led by the tech sector.

The SPX was up sharply overnight closing the session +1.88%. Markets were buoyed to some degree by some better than expected trade data out of China, at the start of the European session yesterday.

China’s exports to the United States are continuing to decline, however overall yearly export growth moved from a 1.3% contraction in June to 3.3% expansion in July, beating all analyst predictions. Which is a strong sign for China given the backdrop of the US-China trade wars.

Despite the positive sentiment, the key risk-off play in the market at the moment which is GOLD is still holding firmly. It is above $1500 still and despite a pullback continued to hold.

The Greenback remains in a tight consolidation around the 97.50 half level and has been rather unresponsive the last few days which is quite unusual.


Asian Market Outlook

We’ve had a busy morning of data with a number of releases right off the bat in Asia. The main one being RBA Governor Lowe speaking.

Lowe is continuing with his dovish stance suggesting we will see a longer period of low-interest rates.  He also said, “the RBA board is prepared to ease monetary policy further to meet inflation, employment goals.”

The AUD/USD is weakening on the talk, after a bounce yesterday. There is more Chinese data out today which as we saw yesterday has the ability to get markets moving.

We also saw some GDP data for Japan which was slightly better and the USD/JPY is falling away as a result.

The RBA Statement on Monetary Policy will also be released later today, but traditionally this isn’t a huge market mover. Given that Lowe is talking today and we’ve just had the RBA I suspect it will be more of the same.

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