AUD News: Australian Dollar Weekly Review - 20 November 2020

The Australian Dollar got off to a flying start this week, initially gaining following the signing of a new China-backed trade deal at the latest ASEAN summit.

These gains were then turbocharged by the announcement from US biotech firm Moderna that its coronavirus vaccine had proved 95% effective in phase three trials.

This, unsurprisingly, was cheered by investors, who piled into the AUD and other risk-sensitive assets.

However, this market optimism began to fade almost as quickly as it appeared, with surging global coronavirus cases souring the mood.

Markets were particularly concerned over the situation in the US, which passed a grim milestone with over 250,000 deaths. This overshadowed a surprisingly upbeat Australian jobs report and left AUD exchange rates on the back foot through the second half of the week.

Looking ahead to next week’s session, with coronavirus cases continuing to surge around the globe, it’s likely a risk-off tone will prevail, limiting the upside potential of the Australian Dollar.

In terms of domestic data, the only release of note will come right at the start of the session, with the publication of Australia’s latest PMIs.

November’s preliminary figures may offer some support to the AUD should they show the recent acceleration of growth in Australia's private sector continued into a third consecutive month.

In broader trade, the publication of the UK and Eurozone’s own PMI releases are likely to put some pressure on both the Pound and Euro at the start of the week, with the former also set to be influenced by Brexit developments. The US Dollar, meanwhile, may be propelled higher by growing coronavirus jitters and a positive durable goods release.

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