AUD/USD pushes back above 0.7200 on resilient consumer sentiment numbers, strong base metal prices


  • AUD/USD pushed back above 0.7200 on Wednesday to trade in the 0.7220s, with the Aussie outperforming in the G10 space.
  • China monetary easing hopes helped base metals higher across the board.
  • AUD likely derived support from upside in base metals and “remarkably resilient” Consumer Sentiment data.

AUD/USD recovered back above its 50-day moving average near the 0.7200 level to test an uptrend that it broke below earlier in the week in the 0.7220s on Wednesday. The pair’s 0.6% rally from the 0.7180s makes the Australian dollar the best performer within the G10 on the day, with the antipodean currency having shrugged off a deterioration in Westpac’s Consumer Sentiment survey which was released during Asia Pacific hours. The headline sentiment index fell 2.0% MoM to 102.2, showing that optimism still outweighed pessimism by a small margin (a score above 100 shows more consumers are optimistic than pessimism). Westpac called the data a “remarkably resilient result” given the recent spread of Omicron, contrasting it with previous much larger deteriorations during “Covid-19 events” (prior outbreaks). This could well be supporting the Aussie.

Upside in base metals was a key driver of the Aussie’s outperformance on Wednesday. US copper futures are up over 2.0% on the day, whilst the Bloomberg Industrial Metals subindex, which tracks a basket of copper, zinc, aluminum and nickel prices, is about 1.8% higher. Iron ore futures also saw substantial gains in Chinese markets during Wednesday’s Asia Pacific session, with the complex deriving a boost not only from a weaker US dollar but also hopes for more monetary easing from the PBoC. The central bank’s vice governor Liu Guoqiang said on Tuesday that more policy measures would be rolled out to stabilise the economy, after surprising markets with a 10bps Medium-term Lending Facility rate cut on Monday.

Looking ahead this week, Australia's December jobs data will be released during the upcoming Thursday Asia Pacific session. If strong, it may encourage markets to bring forward already very hawkish RBA rate hike expectations. For reference, during Wednesday’s session, money market futures implied a 77% chance that the RBA lifts rates to 0.25% in May and then follow that up with a further four rate hikes before the end of the year, taking rates to 1.25%. But analysts think that the straw that could break the camels back (regarding a potential RBA capitulation to hawkish market pricing) could be if next week’s Q4 2021 Consumer Price Inflation data comes in hotter than expected. If AUD/USD can break above the recent short-term uptrend, that could open the door to a move back above 0.7250.

AUD/Usd

Overview
Today last price 0.7225
Today Daily Change 0.0044
Today Daily Change % 0.61
Today daily open 0.7181
 
Trends
Daily SMA20 0.7225
Daily SMA50 0.7198
Daily SMA100 0.7284
Daily SMA200 0.7421
 
Levels
Previous Daily High 0.7229
Previous Daily Low 0.7169
Previous Weekly High 0.7315
Previous Weekly Low 0.7148
Previous Monthly High 0.7278
Previous Monthly Low 0.6993
Daily Fibonacci 38.2% 0.7192
Daily Fibonacci 61.8% 0.7206
Daily Pivot Point S1 0.7157
Daily Pivot Point S2 0.7133
Daily Pivot Point S3 0.7097
Daily Pivot Point R1 0.7217
Daily Pivot Point R2 0.7253
Daily Pivot Point R3 0.7277

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD holds above 1.0700 after US inflation data

EUR/USD holds above 1.0700 after US inflation data

EUR/USD stays in the lower half of its daily range but continues to trade above 1.0700 in the early American session on Friday. The data from the US showed that the annual Core PCE Price Index declined to 4.9% in April as expected, making it difficult for the dollar to gather strength.

EUR/USD News

GBP/USD trades above 1.2600 as dollar struggles to find demand

GBP/USD trades above 1.2600 as dollar struggles to find demand

GBP/USD clings to daily gains above 1.2600 and remains on track to end the week in positive territory. The greenback struggles to attract investors after the data from the US showed that PCE inflation softened in April. 

GBP/USD News

Gold pulls away from daily highs, holds above $1,850

Gold pulls away from daily highs, holds above $1,850

Gold has lost its traction in the second half of the day on Friday and declined toward the $1,850 area. The benchmark 10-year US Treasury bond yield staged a modest rebound on the US PCE inflation data, not allowing XAU/USD to preserve its bullish momentum.

Gold News

Terra’s LUNA 2.0 support expands with Binance and Kraken welcoming the airdrop, here’s how you need to prepare

Terra’s LUNA 2.0 support expands with Binance and Kraken welcoming the airdrop, here’s how you need to prepare

Terra’s LUNA fork proposal has passed with 65.5% votes, Revival Plan 2 in action without algorithmic stablecoin UST. LUNA price could wipe out losses incurred by holders in the colossal crash of LUNC and UST. 

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

Forex MAJORS

Cryptocurrencies

Signatures