The Australian dollar is lower against all major currencies today. AUD is currently the weakest against the Japanese yen, the British pound and the US dollar. Looking at financial markets today, China-sensitive assets such as copper, iron ore and Chinese equity futures are all lower today. Iron ore and copper have experienced particularly sharp sell-offs, while Hang Seng Index futures are slightly lower. Given Australia's reliance on commodity exports to China, the currency is tracking other China-sensitive assets lower.
Later today, we will downgrade our medium-term outlook on the Australian dollar to neutral and our short-term outlook to bearish. Over the coming days, we also expect to downgrade our medium-term outlook to bearish. As Chinese growth slows while fears of a global trade war escalate, the Australian dollar is set to continue weakening.
AUD/USD is down today and trading just above 0.7690. EUR/AUD is up and trading above 1.5950. GBP/AUD is up and trading above 1.810.
Looking at economic data relating to the Australian dollar this week, we'll see the RBA's meeting minutes and changes in employment. Tomorrow, we'll get the house price index and the RBA's meeting minutes. We'll also hear a speech from RBA Assistant Governor Bullock. On Wednesday, we'll see the Westpac leading index. On Thursday, we'll see employment changes for February and the unemployment rate. Last week, new home loans were below consensus estimates.