Daily Currency Update
AUD - Australian DollarThe week has started quietly with many investors looking ahead to a meeting between Presidents Donald Trump and Xi Jinping later this week (June 28-29) after the recent escalation in US-China trade dispute. The Aussie dollar is stronger this morning when valued against the Greenback reaching an overnight high of 0.6968 (up 0.44%). The Aussie dollar gained some support yesterday after RBA Governor Lowe urged the Australian Prime Minister Scott Morrison to get behind infrastructure projects "shovel-ready" in case they are needed for an emergency stimulus to pull Australia out of an economic downturn. The Reserve Bank of Australia (RBA) is tipped to cut the official cash rate to 1 per cent when it meets in July, as weak wages, employment and inflation data continue to hamper the federal government's claims of an economic recovery. Looking ahead today and there are no key data releases scheduled. From a technical perspective, the AUD/USD pair is currently trading at 0.6963. We continue to expect support to hold on moves approaching 0.6940 while now any upward push will likely meet resistance around 0.6970.
Key Movers
The Greenback softened against a basket of currencies on Monday on bets the U.S. Federal Reserve may lower interest rates more than once this year. Interest rates futures implied traders priced in a 100% chance the Fed would cut rates at the end of July, while they are betting on a high probability it might lower rates two more times after that. All eyes this week will be on the outcome of the Xi-Trump meeting at the G20 summit at the end of the week (June 28-29). The USD continues to drift lower, with the commodity currencies showing some of the best, albeit moderate gains. The Pound Sterling hovered just off one-month highs reached earlier on Monday against the dollar. This week GBP/USD pair continues to trade in the recent familiar range between 1.2750 and 1.2550, now closer to the upper limit, benefiting significantly from the weaker US dollar. Looking ahead this week in the UK and today we will see the release of the CBI retail survey for the month of June, on Wednesday the Bank of England’s Governor Carney and members of the Monetary Policy Committee will testify on inflation and economic outlook before the Parliament’s Treasury Committee. From a technical perspective, the GBP/USD pair is currently trading at 1.2735. We continue to expect support to hold on moves approaching 1.2710 while now any upward push will likely meet resistance around 1.2760.
Expected Ranges
- AUD/USD: 0.6900 - 0.7000 ▲
- GBP/AUD: 1.8250 - 1.8350 ▼
- AUD/NZD: 1.0475 - 1.0575 ▼
- AUD/EUR: 0.6075 - 0.6175 ▲
- AUD/CAD: 0.9125 - 0.9225 ▲