AUD/NZD rising over 0.30% to month highs as trade-deal optimism builds
- AUD/NZD moves in on the highest levels for the month on a big week for the cross.
- A less negative geopolitical backdrop lifting the commodity-complex.
AUD/NZD started out on the front-foot this week, rising over 0.30% from a low of 1.0713 to a high of 1.0740, scoring its highest levels since the 1st October. The commodity complex got a boost into the close following news of a 'phase-1' trade deal broke. Both the Kiwi and Aussie popped with AUD marking the highest levels since 19th September on the optimism. Details of the deal are yet to be announced and there has been a slight contraction in price action within the related asset classes - US stocks, for instance, pulled back from their session highs into the close as investors hold their horses awaiting the nitty-gritty of the deal.
At the conclusion of talks in Washington DC on Friday, US and Chinese officials said a partial trade deal had been agreed, with further talks set for November, analysts at Westpac explained."Details are yet to be revealed but the key elements appear to be China’s commitment to substantial increases in imports of US agricultural products and some sort of pledges on intellectual property and currency policy, while the US says it will not proceed with the tariff increase (25% to 30% on $250bn of imports) that was set to take effect tomorrow."
A big week ahead
Meanwhile, its a relatively big week for the cross with a number of scheduled events to potential shake things up, with the likes of Reserve Bank of Australia minutes, RBA Deputy Governor Debelle speaking, Australia employment data, New Zealand Consumer Price Index and the Chinese Gross Domestic Product and Industrial Production. We also have the Chinese September trade data which will be watched closely - "Consensus is for US$ exports to soften to about -3%yr, imports -6%, leaving the trade surplus little changed, around $35bn," analysts at Westpac explained.
AUD/NZD levels