Daily Currency Update
Get access to our expert daily market analyses and discover how your currency has been tracking with our exchange rate tools
Get access to our expert daily market analyses and discover how your currency has been tracking with our exchange rate tools
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. OzForex Limited ABN 65 092 375 703 (trading as “OFX”) and its subsidiaries make no recommendations as to the merits of any financial product referred to in the website, email or its related websites. Please read our Product Disclosure Statement and our Financial Services Guide.
DISCLAIMER: OFX makes no warranty, express or implied, concerning the suitability, completeness, quality or exactness of the information and models provided in this website. Read full disclaimer. OFX provides international money transfer services to private clients and business customers. Use our free currency converter, exchange rate charts, economic calendar, in-depth currency news and updates and benefit from competitive exchange rates and outstanding customer service.
OFX is regulated in Australia by ASIC (AFS Licence number 226 484). Read our Money Laundering Statement and Privacy Policy.
Risk narrative boosted by vaccine hopes
AUD - Australian Dollar
The Australian dollar made fresh 10-week highs through trade on Monday, extending beyond 0.73 US cents. Last weeks risk on mantra continued into the new week as investors pushed equities to record highs and sent safe haven currencies plunging lower. Already buoyed by former Vice President Joe Biden’s victory markets found added scope for optimism following reports Pfizer and BioNtech’s Covid19 vaccine is reportedly 90% effective in preventing Covid19 disease, an incredible result and a strong indication a viable vaccine can be found. The higher appetite for risk drove the AUD to intraday highs at 0.7340 before profit taking prompted a retreat below 0.73 and a narrow 20-point range into this morning’s open.
Attentions remain with the current risk narrative with investors seeking any excuse to extend gains beyond the current resistance threshold. With the Trump campaign still actively contesting the election results, amid claims of voter fraud, there remains a modicum of caution. The incumbent still has 70 days left in office and there is a sense he may use the time to further undermine the election process. That said, there is a growing call for the President to concede. A clear-cut Biden win and further positive COVID 19 vaccine news will likely drive the AUD toward recent highs as the risk narrative regains momentum.
Key Movers
Haven currencies and the USD were the days big losers, plunging lower amid a sustained risk narrative. Buoyed by the Biden/Harris victory and reports Pfizer’s vaccine could be more than 90% effective bolster market demand for risk assets, driving equities toward record highs while dragging the JPY, CHF and USD lower. The JPY fell over 2% and the CHF gave up 1.5%, while commodity currencies soared. Outside the AUD and NZD the Chinese Yuan tested new highs touching 6.5501, while the Norwegian Kroner, Swedish Krone and Canadian dollar all enjoyed strong gains as oil prices surged. Hopes for a viable vaccine have bolstered expectations for global growth prompting a sharp correction across bond markets as investors adjusted expectations for monetary policy stimulus. A successful and widespread community immunization program should allow the re-opening of the global economy, bolstering hopes domestic markets can still rebound throughout 2021.
Attentions remain affixed to the risk narrative for now with haven currencies to remain under pressure.
Expected Ranges
AUD/USD: 0.7190 - 0.7380 ▲AUD/EUR: 0.6080 - 0.6230 ▲
GBP/AUD: 1.7890 - 1.8220 ▼
AUD/NZD: 1.0620 - 1.0750 ▼
AUD/CAD: 0.9390 - 0.9520 ▼