AUD/USD: Positioning to help the aussie to avoid a break of 0.7300 – Westpac

According to economists at Westpac, positioning may help the aussie avoid a break of 0.7300 near-term. But it is hard to make the case for sustained upside given solid USD foundations vs Australia’s widespread lockdowns.

Wages and jobs data to reinforce the gloomy mood

“AUD/USD spent most of the week grinding lower, buffeted by the ongoing drip feed of worrying covid data from states and confirmation of a slump in business and consumer confidence in surveys.”

“The aussie made a marginal new low since 21 July, but 0.7300 did not break. We then saw a surprisingly sharp fall in USD on US July CPI despite it being very close to the median forecast. This hints at a little tiredness in the USD upswing.”

“Positioning may help AUD/USD at least avoid a break of 0.7300 near-term. But it is hard to make the case for sustained upside given Fed taper talk and booming US payrolls. In contrast, Australia’s wages and jobs data should reinforce the gloomy mood.”