Risk currencies hold their ground
SThis was mainly attributed to positioning on the greenback after its recent rally, along with a reversal lower in USD/JPY. There were also a couple of Fed comments on the wires. Kocherlakota said it’s inappropriate to raise the Fed funds rate in 2015 as long as the inflation outlook remains sluggish. However, Dudley stated the forecast of rate increases in mid-2015 are reasonable. Later today we have Charles Evans speaking and, coupled with the FOMC meeting minutes, the Fed is likely to dictate the direction of the greenback in the near term.
AUD focuses on jobs
AUD/USD managed to hold on to the $0.8800 handle but I still feel it remains vulnerable to some selling. While local data is limited today, tomorrow will be a big day as jobs numbers are due out. Following the previous month’s monster 121,000 jobs gain, everyone will be looking for some clarity or perhaps a normalisation in employment.
The market is currently looking for 29,600 jobs lost and for unemployment to rise a touch to 6.2%. Any misses on the jobs front is likely to lead to further AUD selling. On the other hand, a better-than-expected reading could see AUD/USD extend its recovery.
Singapore's selling points? It is more efficient, stable and less corrupt than its larger neighbours. The World Bank says it is the easiest place in the world to do business.
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