Aussie dollar holding above 0.69 US cents

OzForex Research OzForex Foreign Exchange

AUD - Australian Dollar

The Australian dollar is stronger this morning when valued against the Greenback. The Aussie dollar rose to a multi-week high of 0.6908 overnight on the back of encouraging US-China trade-related headlines, suggesting that a deal is “very” close and that the US is willing to give up on tariffs, cutting the existent ones by half. The Australian dollar was given a boost earlier in the week after the U.S Federal Reserve has left the interest rate unchanged on Thursday night at 1.75% which was widely expected however the vast majority of FOMC participants believe rates will remain unchanged in 2020. On the release front yesterday in Australia December Consumer Inflation came in at 4.0%, better than the 3.5% expected, and matching its previous monthly reading.

Looking ahead today and there are no scheduled releases in Australia. All eyes will on US November Retail Sales, seen up by 0.5% in the month, white the Retail Sales Control Group is seen up by 0.3%. From a technical perspective, the AUD/USD pair is currently trading at 0.6905. We continue to expect support to hold on moves approaching 0.6865 while now any upward push will likely meet resistance around 0.6930.

Key Movers

The UK headed to the polls overnight to vote in the general election with the UK Prime Minister Boris Johnson hoping to secure a majority government with 326 constituencies. If a party has a majority, its leader will head to Buckingham Palace to ask the Queen's permission to form a new government. Polls close at 10am AEDT after which the first exit polls will emerge. Yesterday in the UK there were no scheduled macroeconomic releases and there’s nothing relevant scheduled for Friday either. All eyes will focus on the election’s outcome and what it will mean for Brexit. A victory from Prime Minister Boris Johnson would suggest the UK will finally leave the European Union by the end of January.

The GBP/USD pair hit a multi-month high of 1.3229 during Asian trading hours yesterday, helped by dollar’s weakness. From a technical perspective, the GBP/USD pair is currently trading at 1.3182. We continue to expect support to hold on moves approaching 1.3100 while now any upward push will likely meet resistance around 1.3240.

Expected Ranges

AUD/USD: 0.6800 - 0.7000 ▲

GBP/AUD: 1.8900 - 1.9100 ▼

AUD/NZD: 1.0350 - 1.0550 ▲

AUD/EUR: 0.6100 - 0.6300 ▲

AUD/CAD: 0.9000 - 0.9200 ▲

Author

OzForex Research

OzForex Foreign Exchange

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