AUD/USD continued to trade gently yesterday in a tight 0.9620-50 range. With little economic data this week the market is looking forward to FED’s Yellen Jackson Hole Speech as main catalyst for the next bout of AUD/USD movement.
With September FOMC Rate hike odds only at 24% the potential for a sharp adjustment higher is there if Yellen indicate’s the FED is serious about raising rates next month. The majority of traders are confident her speech will be neutral as she doesn’t have a history of surprising markets and the FED has made a point in recent times to telegraph a rate well in advance not a few weeks before.
The last 30 days movement in the S&P 500 have been the lowest in 20 years with no movement above 1% in a rare display of market calm as we remain right near record highs and adds to the argument that the FED will not be looking to rock the boat.
WTI OIL did move overnight however with a sharp move higher back to $48 a barrel reacting to comments from Iranian Oil sources suggesting that the middle eastern country was open to a OPEC Output Freeze.