US shares rebound
Global markets rebounded after Friday’s massive meltdown with an easing of US-China trade tensions boosting markets.
Further moves towards a lasting ceasefire in the Middle East also supported markets.
US shares jumped with the benchmark S&P 500 up 1.6% as US Treasury Secretary Scott Bessent said a key meeting between US president Donald Trump and Chinese Xi Jinping is still likely to go ahead.
The Aussie led gains in FX markets with the AUD/USD up 0.6% but still down significantly from last Friday. The Aussie was higher in most other markets.
The NZD/USD was flat, as were USD/SGD and USD/CNH.
The safe havens gave back last week’s gains with the USD/JPY up 0.7% and USD/CHF up 0.6%.
RBA minutes due
The Aussie remains in focus with the Reserve Bank of Australia minutes due at 11.30am AEDT.
The RBA’s 30 September meeting surprised markets by raising concerns about sticky inflation after the monthly inflation index jumped from 1.9% to 3.0% between June and August.
As such, markets will be looking for more detail about the falling chances for a 4 November rate cut.
After Friday’s sharp falls, the AUD/USD’s short-term resistance is seen at 0.6520, a level that might cap gains in the near term.
Above that, topside orders are to 0.6565 while support is seen at the 200-day moving average 0.6495.
Euro underperforms
In other markets, the euro underperformed with the EUR/USD down 0.4% as it fell to two-month lows.
The euro was weaker in other markets with the AUD/EUR reclaiming most of last Friday’s losses with an almost 1.0% gain overnight.
Looking forward, European CPI numbers will be key.
Aussie bounces back
Table: seven-day rolling currency trends and trading ranges
Key global risk events
Calendar: 13 – 18 October
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*The FX rates published are provided by Convera’s Market Insights team for research purposes only. The rates have a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer.