AUD - Australian Dollar

The Australian dollar was the weakest of major currencies through trade on Tuesday, giving up 0.7% amid dovish commentary from RBA Governor Philip Lowe and a broader risk off tone. The AUD tracked sideways through the early hours of the domestic session, bouncing between 0.7360 and 0.7375 before comments from RBA Governor Lowe forced the currency through 0.7350. While maintaining an expectation the economy will rebound swiftly once lockdowns are removed, Lowe pushed back on market expectations for a rate hike in 2022 and H1 2023. Lowe was at pains to point out that it was “difficult to reconcile a rate hike with his central view that inflation and wages will rise slowly from here on out”. His comments forced investors to push back prospects for a normalisation of monetary policy and brings in to focus a widening gap in RBA policy outlook and that of other major central banks. Having found support at 0.7340 the AUD found a brief respite in softer than anticipated US CPI data bouncing back toward 0.7370 before a broader risk off tone sent the currency toward intraday lows at 0.7315.

Our attentions today remain with the broader risk narrative. The AUD remains vulnerable to sweeping changes in risk sentiment, and we expect will continue to track USD moves through the short term.

Key Movers

A risk off vibe drove price action across major currencies through trade on Tuesday, bolstering demand for the JPY, CHF and USD while forcing commodity currencies lower. The US dollar shifted sharply lower in the wake of CPI data before risk appetite helped drive the world’s base currency higher into this morning’s open. Both headline and core inflation undershot market expectations for August, with core inflation correcting off 30-year highs and moderating back to 4%. Key components to last month's rise retreated through August as the Delta variant continues to rip through the US and hold back domestic demand. The softening in CPI data highlighted the challenges facing a broader recovery and have forced some analysts to extend the timeline of recovery.

Our attentions today turn to Canadian CPI data, while US industrial production and capacity utilisation headline the macroeconomic docket.

Expected Ranges

AUD/USD: 0.7270 - 0.7370 ▼

AUD/EUR: 0.6150 - 0.6240 ▼

GBP/AUD: 1.8770 - 1.9030 ▲

AUD/NZD: 1.0280 - 1.0360 ▼

AUD/CAD: 0.9250 - 0.9320 ▼

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

Latest Forex Analysis


Latest Forex Analysis

Editors’ Picks

EUR/USD remains pressured after US data misses estimates

EUR/USD is trading closer to 1.1750, paring its recovery from earlier in the day as the safe-haven dollar is bid. US Consumer Sentiment missed estimates with 72 points in September. The financial woes of China's Evergrande are weighing on sentiment.

EUR/USD News

GBP/USD trades under 1.38 amid on UK data, dollar strength

GBP/USD is on the back foot, trading under 1.38 after UK Retail Sales figures disappointed with -0.9% in August, worse than expected. Brexit uncertainty and dollar demand weighed on the pair earlier. 

GBP/USD News

XAU/USD surrenders intraday gains, drops closer to $1,750 level

Gold struggled to preserve its intraday gains and dropped to the lower end of the daily trading range during the early North American session. 

Gold News

Experts say Ripple will win SEC lawsuit, which might propel XRP to new all-time highs

The latest development in the ongoing SEC vs. Ripple lawsuit is that documents are classified as privileged and blocked for public viewing. Though institutional investors are yet to take big bets on the altcoin in 2021, retail investors are actively trading in XRP.

Read more

US Michigan Consumer Sentiment Preview: Markets will have to look hard for positive signs

Consumer outlook expected to rebound to 72.2 in September. August’s 70.2 was the lowest since December 2011. Inflation and Delta variant wearing on US optimism. Markets face negative dollar risk from fading consumer optimism.

Read more

Majors

Cryptocurrencies

Signatures