Daily currency update

The Australian dollar edged lower through trade on Wednesday, unable to hold onto gains above 0.71 US cents. Despite a quieter session across global equity indices and a general improvement in risk sentiment, the AUD gave up intraday highs at 0.7120 marking intraday lows at 0.7040 overnight. There appears little catalyst behind the overnight move lower outside a general reluctance to move significantly against broader global forces. Comments from Chinese Premier Li acknowledging Q2 growth prospects remain muted and a “far cry from their annual 5.5% goal”. Li’s comments highlight a growing narrative surrounding the impacts of COVID zero policy and broader global recession.  Having found support below US$0.7050 the AUD climbed back toward US$0.71 leading into this morning’s open where it currently buys US$0.7081. Our attentions turn now to US jobless claims. With unemployment filings rising over the past 6 weeks we are keenly attuned to any further softening in the US labour market.

Key movers

The euro was the day’s big mover giving up Tuesday’s extension beyond US$1.07 to hit intraday lows at US$1.0640. ECB officials continue to support President Lagarde’s plan to exit negative interest rates before the year’s end however, mixed messaging from officials has raised questions as to what shape and form interest rate adjustments will take. The consensus appears to be a series of 25 basis point hikes in July and September, while some commentators are calling for a 50-basis point hike and others for a more measured and considered approach. With markets pricing 65 basis points of hikes into September, the overnight commentary did little to add support to the euro and with global forces and headwinds still plaguing the broader growth outlook markets appeared reluctant in extending gains. Having hit intraday lows the euro did find support on broader USD softness late in the overnight session. The FOMC minutes showed the Fed plans to move at pace toward neutral interest rates, all but guaranteeing a 50-point hike at the next two policy meetings before a potential pause and assessment of current conditions. The potential for a pause in the tightening cycle helped lift risk sentiment across equity markets and forced the USD lower across the board. The euro recovered to hit US$1.0690 while the British pound closed in on a break above US$1.26 and the Japanese yen staved off a break back above US$127.50. Our attentions turn now to US jobless claims. With unemployment filings rising over the past 6 weeks we are keenly attuned to any further softening in the US labour market.

Expected ranges

  • AUD/USD: 0.7020 – 0.7150 ▼
  • AUD/EUR: 0.6580 – 0.6720 ▲
  • GBP/AUD: 1.7580 – 1.7820 ▲
  • AUD/NZD: 1.0920 – 1.1020 ▼
  • AUD/CAD: 0.9050 – 0.9150 ▲

IMPORTANT: This information has been prepared for distribution over the internet and without taking into account the investment objectives, financial situation and particular needs of any particular person. Oz Forex Foreign Exchange makes no recommendations as to the merits of any financial product referred to in this website, emails or its related websites. Please read our Product Disclosure Statement and our Financial Services Guide.

Regulated in Australia by ASIC (AFS Licence number 226 484)
© 2010 Copyright Oz Forex Foreign Exchange Pty Ltd ABN 65 092-375-703
OzForex Foreign Exchange Services

Member of FOS (Financial Ombudsman Service)
Full Member of AFMA (Australian Financial Markets Association)

Feed news Join Telegram

Recommended Content


Recommended Content

Editors’ Picks

EUR/USD recovers modestly, trades below 1.0550

EUR/USD recovers modestly, trades below 1.0550

EUR/USD has managed to stage a rebound after having declined toward 1.0500 in the early American session. The negative shift witnessed in market sentiment after the latest US data, however, helps the dollar find demand and doesn't allow the pair to extend its recovery.

EUR/USD News

GBP/USD trades below 1.2200 pressured by risk aversion

GBP/USD trades below 1.2200 pressured by risk aversion

GBP/USD has extended its daily slide and touched a fresh five-day low below 1.220 in the second half of the day on Tuesday. Wall Street's main indexes are suffering heavy losses, providing a boost to the safe-haven dollar in the American session.

GBP/USD News

Gold continues to fluctuate in tight range above $1,820

Gold continues to fluctuate in tight range above $1,820

Gold edged lower in the early American session but managed to erase its daily losses. With the 10-year US T-bond yield falling into negative territory amid risk aversion on Tuesday, XAU/USD holds its ground and continues to trade near $1,820.

Gold News

Former Ripple CTO is dumping millions of XRP, traders beware

Former Ripple CTO is dumping millions of XRP, traders beware

XRP price shows promise that it is ready to trigger a massive run-up as the first half of the year comes to an end. There are three reasons why investors should be bullish on Ripple.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Majors

Cryptocurrencies

Signatures