AUD – Australian Dollar
The Australian dollar is trading around 0.7750 this morning against the greenback. Slightly up on yesterday when we saw the Aussie dollar trade as low as 0.7704 at the beginning of the day. The Aussie recovery was led by higher equities and lower US government bond yield put pressure on the greenback. Lower US Treasury yields have helped boost risk sentiment, sending US equities higher, led by the tech sector.
On the data front there are no scheduled releases today in Australia. Looking ahead this week and tomorrow we will see the release of monthly Purchasing Managers’ Index (PMI) and Goods Trade Balance. From a technical perspective, the AUD/USD pair is currently trading at 0.7743. We continue to expect support to hold on moves approaching 0.7730 while now any upward push will likely meet resistance around 0.7820.
On Monday the Greenback extended its decline during the US afternoon, as US Treasury yields eased, with that on the 10-year note bottoming at 1.66% and settling nearby. A lower rates backdrop has boosted US equities, with the S&P500 currently up 0.8% and the more rates-sensitive Nasdaq index up over 1½% as the IT sector leads the way.
AstraZeneca reported overnight that an advanced trial data from a US study reported that its COVID19 vaccine was shown to be safe and 79% effective. The vaccine was 80% effective in participants aged 65 and over and 100% effective in preventing serious illness and hospitalisation across ages and ethnicities. Although AstraZeneca’s vaccine has been authorised in more than 50 countries, including Australia, it has not yet been given the green light in the US. The data paves the way for FDA approval in the US and should boost confidence and clear up some of the confusion about just how well the shots work.
AUD/USD: 0.7650 – 0.7800 ▼
GBP/AUD: 1.7800 – 1.8100 ▼
AUD/NZD: 1.0750 – 1.0850 ▲
AUD/EUR: 0.6400 – 0.6550 ▼
AUD/CAD: 0.9620 – 0.9720 ▼