Morning Call Script - 25 Oct 2023
Overnight asset drivers & the impending data calendar
What’s Moved Overnight
Overnight Data: AUD inflation hotter than expected … AUD 5.4% YoY (5.3% exp and prior 6%) and 5.6% MoM (exp 5.4%, prior 5.2%). Given RBA Bullock opened the door to further hikes, the data has provided AUD with a further tailwind and subsequently the main outperformer o/n... AUDUSD +42bps to 0.6382, EURAUD down a further 70bps to 1.6612.
Pepperstone - Australia Q3 CPI reaction – hikes are back on the table
China - to raise 1trillion yuan to support fiscal / infrastructure expenditure to prevent and rebuild areas hit by natural disasters. Local governments are also now allowed to front-load some of their 2024 bond quotas.
Elsewhere a sleepy overnight session in G10 FX with EURUSD once again tied to 1.0600. Monday's USD weakness was reversed by the diverging picture displayed by flash PMI's across the atlantic. US outperformance brought us back into range ahead of Thursday's ECB. (GBP 1.2175, CAD 1.3745, NZD 0.5850)
Earnings: Microsoft and Alphabet both beat earnings forecasts but that's where the comparisons end with the former up 4% in after-hours trading whilst the latter dropped 6%. Microsoft's cloud computing is booming, Alphabet's missed revenue estimates.
Have a great day, and keep smiling!
Podcast for the Commute
Goldman Sachs - Unlocking the AI M&A Supercycle
The Day Ahead
EUR (09:00): IFO Expectations
CAD (15:00): BoC Monetary Policy Report
USD (15:00): New Home Sales
CAD (16:00): BoC Press Conference
USD (18:00): 5yr note auction
Meta reports after hours (Reuters - dozens of US states are suing Meta)
USD (21:35): Fed Chair Powell
Stay informed throughout the day with our new commentary feed (‘Intraday Market Colour’) highlighting key notes, topics du jour, and HarksterHQ’s market updates around key data points and headlines.
Available on the Harkster Research Platform.
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