Aussie dollar opens slightly lower below 78 US cents
Friday 23 October, 2020
Daily Currency UpdateAUD - Australian DollarThe Australian dollar is slightly weaker this morning when valued against the Greenback, trading just below US78¢. Overnight the Aussie reached a high of 0.7818 on the back of continued broad greenback weakness and a rising in commodities and equities. The outlook for the Australian dollar remains strong on the strength of commodity markets, with iron ore and copper prices hitting their highest level since February 2011, which has seen the currency above US78¢. Looking ahead today on the data front and we will see the release of the Q1 Producer Price Index and March Private Sector Credit. Investors will also look at the Chinese NBS Manufacturing PMI, expected at 51.7 and the services index for the same month, foreseen at 52.6. From a technical perspective, the AUD/USD pair is currently trading at 0.7766. We continue to expect support to hold on moves approaching 0.7730, while any upward push will likely meet resistance around 0.7820.
Key MoversOvernight India’s total COVID-19 cases have passed 18 million, after another world record number of daily infections. India reported 379,257 new infections and 3645 new deaths on Thursday, as health ministry data showed, the highest number of fatalities in a single day since the start of the pandemic. The world’s second most populous nation is in a deep crisis, with hospitals and morgues currently overwhelmed. Although India is the world’s biggest producer of vaccines, it does not have the stocks for the estimated 800 million now eligible.On the data front yesterday, in the US preliminary estimates for the first quarter Gross Domestic Product came in at 6.4%, beating expectations. The Greenback, however, was unable to take advantage of the encouraging headline, instead pressured by risk-appetite. Initial Jobless Claims, which fell to 553,000, the lowest level since the pandemic began. Next week, the US will release Non-Farm Payrolls for April. Current expectations are for +900,000 jobs to have been added to the economy. Looking ahead today and the US will publish March Personal Income and Personal Spending, and the final reading of the April Michigan Consumer Sentiment Index, expected to be upwardly revised to 87.5.
- AUD/USD: 0.7650 - 0.7850 ▼
- AUD/EUR: 0.6310 - 0.6495 ▲
- GBP/AUD: 1.7800 - 1.8000 ▼
- AUD/NZD: 1.0600 - 1.0800 ▲
- AUD/CAD: 0.9450 - 0.9650 ▼