Home Daily Commentaries AUD fails to capitalise on US dollar softness

AUD fails to capitalise on US dollar softness

Matt Richardson
Written by
Matt Richardson

Matt Richardson

OFXpert

Matt provides expertise in currency risk management to his clients, drawing from his 14 years of experience in foreign exchange.

| Tuesday 26 November, 2024

Daily Currency Update

The Australian dollar underperformed through trade on Monday, unable to capitalise on a weaker US dollar. The AUD slipped back below US$0.65 on Monday, unable to sustain last week's recovery, despite a weaker US dollar. While the dollar met early selling pressure on renewed risk demand, following the appointment of Scott Bessent as US Treasury Secretary, the AUD failed to capitalise. Instead, it drifted off intraday highs just short of US$0.6550 to mark intraday lows at US$0.6489.

With little of note on today’s domestic ticket our attentions turn to US home sale and consumer confidence data ahead of the release of local CPI inflation data, the Fed’s November meeting minutes and an RBNZ policy update. We expect the AUD will remain range bound between US$0.64 and US$0.66 through the near term.

Key Movers

The US dollar traded lower to start the week as market attentions remain affixed to US political appointments. Reports Scott Bessent will be appointed US Treasury Secretary helped assuage building market concern surrounding the impact of a Trump 2.0 Presidency. Bessent is seen as a pragmatic and orthodox choice, with extensive market knowledge and one that will not launch headlong into a trade war, instead promoting market stability and domestic growth. In his first address since the appointment, Bessent said his priority will be to deliver on Trump's proposed tax cuts while lowering the fiscal deficit, controlling inflation and adopting a gradual approach to tariffs.

Equities advanced, while treasury yields and the US dollar retreated in response. The euro, GBP and yen all rallied early before losing traction and retracing gains through the latter half of the overnight session. Our attentions turn now to US home sales and consumer confidence data in what is otherwise a quiet macroeconomic ticket.

Expected Ranges

  • AUD/USD: 0.6400 - 0.6600 ▼
  • AUD/EUR: 0.6150 - 0.6250 ▼
  • GBP/AUD: 1.9200 - 1.9500 ▲
  • AUD/NZD: 1.1080 - 1.1180 ▼
  • AUD/CAD: 0.9050 - 0.9150 ▼

Written by

Matt Richardson

OFXpert

As a Senior Corporate Client Manager, Matt provides expertise in currency risk management to his clients, drawing from his 14 years of experience in foreign exchange. Matt has clients who he has been working with for over a decade, a testament to his knowledge and dedication in the field. Matt is also a regular contributor on Ausbiz, offering clear and precise updates on currency market trends, showcasing his ability to interpret complex financial data into actionable insights.

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