The AUD remains under pressure this week as neutral comments from the Reserve Bank of Australia on Tuesday failed to inspire confidence in the dollar. Even Wednesday’s better-than-expected GDP figures failed to make a mark as investors believe that the current lockdown in Victoria will impact growth in the coming months.
A 15% jump in iron ore prices was ignored this week and Thursday’s mediocre retail sales figures did more harm than good, leaving the AUD limping into the weekend.
AUD to NZD
After the NZD’s surge following comments from the Reserve Bank of New Zealand last week, the Kiwi has failed to keep the momentum, with lacklustre data failing to provide support. The AUD is now sitting at the highest level against the NZD for a week, despite poor performance against the major currencies in the past few days. Next week’s economic calendar looks quiet for both Australia and New Zealand, so the markets will look to the data out of China to provide both sides with support.
AUD to USD
Despite a handful of banks forecasting the AUD will trade over 0.80 this year, it looks unlikely at this stage. Australian GDP figures printed gains of 1.8% QoQ on Wednesday, 0.3% higher than predicted, but the AUD failed to make gains against the safe-haven USD. A light economic calendar for Australia over the next week could see the USD push lower and potentially break out of the tight range we have seen it trading in for the past seven weeks.
AUD to GBP
The GBP has been buoyant of late as the British government continues to fully unwind the lockdown restrictions in the UK — a marked contrast from what is currently happening in Australia. The extended seven-day lockdown in Victoria has dented the AUD this week as the state struggles to contain the new variant of the coronavirus. Both UK GDP and unemployment figures will be scrutinised next week and good results here may push down the AUD further in the short term.
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