Home Daily Commentaries Australian Dollar retests 80 U.S. cents

Australian Dollar retests 80 U.S. cents

Tuesday 1 August, 2017

Daily Currency Update

Key Movers

Closing out the month of July with gains totalling 4 percent when valued against its US Counterpart, the Australian dollar whilst enjoying a quieter session on Monday has remained well and truly in a position of strength. Etching out 0.2 percent worth of gains yesterday, Manufacturing and Non-Manufacturing PMI’s from China had only a muted impact on the domestic unit as investors upheld their laser-like focus on the RBA who meets today. Given no change in the underlying cash rate is expected, their economic outlook along with any perceived shifts towards a tighter policy stance will undoubtedly be a key driver for the AUD. Sensing it all lies ahead, the Australian dollar currently buys 80.01 US Cents. 
The New Zealand Dollar remains largely unchanged when compared to its US counterpart. Again treading water just above the 0.75 mark, the Kiwi traded within a relatively tight range, oscillating between 0.7468 and 0.7522. Again, the main theme of USD weakness remains the driver of direction in the pair. Over in Europe, the New Zealand dollar fell to a two-week low of 0.6344 against the Euro. The Eurozone posted a slight dip in unemployment and stronger inflation which supported the broader narrative of central banks tapering accommodative monetary policy. Across the Tasman, the Kiwi remained static against the Aussie trading overnight at 0.9390. Ahead of NZ unemployment numbers on Wednesday, traders look to the Australian RBA rate statement slated for release today for direction. 
Commodity currencies were boosted overnight as US crude oil prices rose to two month highs and above $US50 a barrel. Solid Chinese data also saw Chinese Iron Ore jump 8% to eight month highs during Monday trading. Political risk has come to the forefront of investor minds overnight in the United States as further turmoil in the White House as communications director Anthony Scaramucci lasted just ten days The US Dollar Index fell another 0.5% overnight to 92.85 and has closed at its lowest since May 2016. End of month readjustments and a stable European inflation print saw the EUR/USD hit 2 ½ year highs of 1.1845. The US Dollar has also extended its losses against the Japanese Yen, seeing a 0.5% drop overnight to reach overnight lows of 1.1022.

Expected Ranges

  • AUD/USD: 0.7900 - 0.8060 ▲
  • NZD/USD: 0.7450 - 0.7600 ▲
  • GBP/AUD: 1.6400 - 1.6700 ▲