AUD in focus after leadership change

The relentless march in the USD index continued as it finally traded at 83.

Although the DXY has experienced a minor pullback from this psychologically important level, we still feel there is more room for further strength in the near term. The single currency remains under pressure and it seems a break below $1.30 on EUR/USD is imminent. EUR/USD printed a low just beneath 1.30 and continues to flirt with that psychological support. Later today we have German unemployment change, an Italian bond auction and day 1 of the EU Economic Summit to look out for. This might cause further volatility for the pair today with the potential to trade below 1.30.

The political dramas will no doubt have the world talking and this does not give much confidence in the local currency. AUD/USD already had a lot to contend with, particularly as the mining slowdown weighs on the economy while the USD returns to favour. There is now also the prospect of an earlier election in August and the RBA will also be monitoring the developments very closely. Many analysts were expecting to see a rate cut pre or post-election and we’ll have to wait and see what impact this has on the swaps market. AUD/USD is now back below 0.93 and we might see it struggle today as the political arena unravels.

NZD/AUD will be in focus today on the back of New Zealand’s disappointing trade balance figures. The country recorded a 71 million trade surplus, while consensus was for a 412 million surplus. This has weighed on NZD/AUD and we are eyeing support in the 0.834 region. There is also ANZ business confidence to look out for as well as industrial profits data out of China today.


This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen. 79% van de retailbeleggers lijdt verlies op de handel in CFD’s met deze aanbieder.
Het is belangrijk dat u goed begrijpt hoe CFD's werken en dat u nagaat of u zich het hoge risico op verlies kunt permitteren.
CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen.