ANZ has conducted an analysis of its AUD spot flows dating back to 2015. The objective was to identify patterns in client activities and gain a better understanding of how various client groups behave. Results highlight a stronger buying bias towards the AUD spot, particularly among corporate clients.

Key Points:

• Data Timeframe: The analysis covers AUD spot flows from 2015 up to the present.

• Client Community Analysis: The study investigated trends in activity across different client communities, aiming to decipher where the majority of the flows are originating and their directional biases.

• Seasonal Trends: ANZ delved into seasonal variations in daily spot volumes and net buying activities. This analysis could offer insights into specific periods during the year when AUD/USD spot buying or selling is more pronounced.

• Corporate Community Dominance: Corporate clients appear to be major players in the AUD spot market. Their activities have been observed to be more volatile compared to the aggregate of all clients. More notably, corporates demonstrate a significantly stronger buying bias for the AUD spot over the years.

• Investor vs. Corporate Community: Compared to investor communities, corporate communities have shown a pronounced buying bias. This means corporates have been more aggressive in purchasing AUD compared to investors, based on the data from the past years.

Implications:

For Traders and Investors:

• Spotting Trends: Traders could potentially use this information to identify when corporate buying might influence the AUD/USD spot rate, thereby tailoring their strategies accordingly.

• Seasonal Adjustments: Knowing the periods of heightened buying or selling activity may help traders better time their entries and exits.

• Risk Management: For those dealing heavily in the AUD/USD pair, understanding the potential volatility brought on by corporate flows can be crucial for risk mitigation.

Conclusion:

ANZ's analysis offers valuable insights into the AUD spot market dynamics over the past years. While various client communities contribute to the market's liquidity and direction, it is the corporate community that stands out with its pronounced buying bias. This pattern, coupled with the observed seasonal trends, could provide traders and investors with essential data to make informed decisions in the AUD/USD market.