This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
The Aussie is trading at $0.9364, as high as $0.9386 in the early session, the highest it has been since November 2013.
Traders have taken some of their profits off the table ahead of the statement from the US central bank at 7pm (London time). Last night, Fed member Charles Plosser stated the increase in interest rates will probably come next year, and will depend on ‘the data’. Mr Plosser also expressed his desire to see the Fed give more details about its rate increase plans, but I expect the US central bank will continue to keep its cards close to its chest.
If Janet Yellen reiterates her previous slightly dovish stance, we could test the $0.94 mark. I feel a break through that level would have to come from Australian dollar strength rather than US dollar weakness.
Australia will announce the unemployment rate at 2.30am (London time), with expectations of an increase to 6.1%. If the jobless figure is worse than expected, we could retrace back to the $0.93 mark. As I mentioned previously, the Reserve Bank of Australia feels the AUD is still too strong.