The AUD opens at 0.7038 and the NZD opens at 0.6618
November 3, 2020 — 2 min read
All eyes will be on Australia for the all-important financial event. Winners will be decided and losers will rue their bad luck. Before the Melbourne cup though we have the RBA out at 2:30 pm AEDT, with the equally important, but maybe somewhat less exciting RBA announcement. Practically speaking, they are widely expected to cut rates to 0.1%, from 0.25% currently. In fact if you look at market pricing, it is pricing in an 83% chance of a full 0.25% cut, so if you do the math that actually implies the “base case” for the market is a cut to 0.04%. This is clearly not going to happen, but it is interesting to note that the market could be a bit ahead of itself, and there may not be much drop in the AUD at all if indeed there is a cut to 0.1%.
Oil has had a funny few days. When it finally opened yesterday it was down to around US $34 a barrel, the lowest since May and off a good 5%. This has since bounced but if you remember back in March, Oil was one of the first things to really crack and go haywire, so worth keeping an eye on. Oil has many factors which influence its price, but since Covid it has been a pretty clean proxy for world growth, and you were seeing the recent lockdowns reflected in its price.
The big US Election is tomorrow local time, with results coming in throughout the day. If it is a landslide we may even know by tomorrow afternoon/evening, however if it is close it could well be days or longer till a final result is confirmed.
Global equity markets are up - Dow +1.0%, S&P 500 +0.5%, FTSE +1.4%, DAX +2.0%, CAC +2.0%, Nikkei +1.4%, Shanghai +0.0%.
Gold prices are up 0.7% to USD$1,892 an ounce and WTI Crude Oil prices are also up 6.2% to US$36.5 per barrel.