AUD - Australian Dollar

The Australian dollar broke below 0.69 US cents Friday, maintaining a week long sell off to test 1-month lows near 0.6850. With little of note on the domestic docket, the AUD succumbed to broad based demand for the USD, as stronger than anticipated domestic data and increasing concern surrounding the impact of trade tensions on the Chinese economy weighed in investors’ appetite for risk. The worlds base currency found support after revisions to retail sales data suggest the pace of deceleration across the US economy may not be as rapid as first feared, allowing the Fed to measure the pace and timing of any future rate cut.

Having touched intraday lows at 0.6853, both domestic and global markers suggest there is more room to fall as demand for risk remains weak in the face of percolating trade tensions while soft domestic data points add mounting pressure on the RBA to cut rates again. With supports at 0.6850 holding for now, attentions turn to June’s RBA meeting minutes tomorrow and the Federal Reserves FOMC policy meeting Wednesday. Following Thursday uptick in unemployment markets will be keenly attuned to RBA rhetoric for clues as to when policy makers will cut again. While July looks unlikely there is mounting pressure the board to move in August with a 2nd cut fully priced in by October. A break below 0.6850 could prompt a deeper correction and force a move toward 0.67. In contrast an upbeat RBA and a dovish Fed could stave off AUD downside and foster a run back toward 0.70.

Key Movers

The US dollar rallied through trade on Friday, advancing to a 2-week high following moderate retail sales data. Consumer spending rose half a percent in May, largely meeting analyst expectations, while data for April was revised upward having originally shown a two tenths contraction. The upbeat read assuaged investor fears that the pace of economic growth is decelerating at an alarming rate, easing some of the pressure on the Federal Reserve to reverse its recent monetary policy tightening.

Sterling marked a sixth consecutive week of losses when valued against the Euro as pro-Brexit conservative Boris Johnson firms as the favourite to replace Theresa May as Prime Minister. Concerns Johnson will lead the UK out of Europe without a deal in place are weighing heavy on the Pound, forcing Cable nearer through 1.26 to 1.2571

Expected Ranges

AUD/USD: 0.6830 - 0.6980 ▼

AUD/EUR: 0.6080 - 0.6180 ▼

GBP/AUD: 1.8150 - 1.8350 ▼

AUD/NZD: 1.0520 - 1.0650 ▲

AUD/CAD: 0.9140 - 0.9280 ▲

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)

Analysis feed

Latest Forex Analysis

Editors’ Picks

EUR/USD remains depressed but off daily lows

The EUR/USD pair is recovering from a daily low of 1.1216, although holding in negative territory for the day. US preliminary Michigan Consumer Sentiment Index improved by less-than-anticipated in July, coming in at 98.4 vs. the 98.5 expected.

EUR/USD News

GBP/USD trading marginally lower daily basis but above 1.2500

The Pound gave back some of its Thursday’s gain on dollar’s relief. The GBP/USD pair broke a daily descendant trend line coming from June’s high and holds above it, leaving little room for sellers to act.

GBP/USD News

USD/JPY: bears pausing, still in control

Japanese National Inflation steady at 0.7%YoY in June. US Michigan Consumer Sentiment Index expected at 98.5 in July. USD/JPY corrective advance falling short of signaling an interim bottom in place.

USD/JPY News

Something has spooked the Fed

We wish we knew what it is. Wild talk of the US joining Japan and Europe with zero or negative return on the 10-year is or should be very frightening.

Read more

Gold consolidates around $ 1440, eyes US data for fresh direction

Gold (futures on Comex) extends its side-trend around the 1440 mark into the mid-European session, having stalled its retreat from 2019 highs of 1454 near 1437 region.

Gold News

Majors

Cryptocurrencies

Signatures