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AUD/USD hits fresh 2022 high

Monday 7 March, 2022

Daily Currency Update

The Australian dollar hit a fresh 2022 high at the Friday close, soaring to 0.7374 to record a 0.63% appreciation. Despite the financial world remaining fixated on the global risks from the Russian invasion, the Aussie proved resilient to risk-off moves in other markets. The commodity linked Aussie appreciated due to a number of factors, but chief among them is soaring commodity prices. Prices from crude and nickel to aluminum and wheat rocketed last week, to record the largest weekly surge since the oil crisis in 1974. Adding impetus to the Aussie was some decent local macroeconomic numbers, with Retail sales recording an expected 1.8% increase in January as well as Q4 GDP recovering to 3.4%. In the upcoming week, the Aussie will look to NAB’s February Business Confidence Index, Westpac’s March Consumer Confidence and Consumer Inflation Expectations for March. RBA Governor Lowe will also add his two cents throughout the week. Of course, the major focus throughout the week will be on the war in Ukraine.

Key Movers

The euro fell 1.24% against the Greenback on Friday to open this morning at 1.0929. The Great British pound also fell sharply, albeit not quite as much as the euro. Opening this morning at 1.3233, the sterling dropped 0.85% against the Greenback. Unsurprisingly, the EU and UK's proximity to the war and its reliance on Russian energy and trade made it a prime risk-off target throughout the week as the war in Ukraine evolved. Putin appears to have changed his strategy with a long, drawn out, devastating European war potentially on the table. Furthermore, attacks on the Zaporizhzhia nuclear plant added another layer of uncertainty, which forced the euro and sterling even lower on Friday.

Expected Ranges

  • AUD/USD: 0.7301 - 0.7447 ▲
  • AUD/EUR: 0.6679 - 0.6812 ▲
  • GBP/AUD: 1.7759 - 1.8118 ▼
  • AUD/NZD: 1.0633 - 1.0848 ▲
  • AUD/CAD: 0.9289 - 0.9476 ▲