The Australian Dollar finds itself in familiar territory this morning, flirting with the 0.72 level. Opening this morning at 0.7192, the Aussie was well supported for much of the Asian session with Q2 GDP surprising the market. Ultimately, however, the almost vertical incline at the time of the announcement was whittled away to be a footnote in the broader narrative.
Second quarter GDP dominated proceedings for much of the domestic session with a posting of 0.9% against the expected 0.7% expansion, ultimately recording a 3.4% increase for the year to June. The Aussie climbed almost immediately by approximately 40 points to test 0.7210 but couldn’t breach the level. The market took the news with a grain of salt and quickly unwound the Aussies gains, flatlining to as low as 0.7148 at the European open.
Globally, emerging markets were the big winners of the day with a rising wave of positive risk-sentiment forcing the USD lower across several emerging market and commodity currencies. The Aussie also benefitted from this, although it was limited, with a slow, gradual rise to where we open this morning at 0.7197.