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Grinding Higher

AUD

AUD/USD has trended higher today, breaching above 0.7180, +0.30% on the day, in line with broad based USD weakness and positive risk appetite.

  • The A$ has only seen modest outperformance in the G10 FX space today, with AUD/JPY up just 0.25% since the open (to 91.25). Focus has been more on USD/Asia pairs, with both USD/CNH and USD/KRW falling 1% or more.
  • The cross-asset backdrop has been supportive from an equity standpoint, buoyed by easing Covid restrictions in China.
  • Still, iron ore hasn't been able to build on gains from late last week. We are back to a $133/tonne handle from $135/tonne earlier. Copper has continued to push higher though, +0.70% on the day.
  • Tomorrow, the data calendar swings back into gear, with the Q1 current account, net export contribution to GDP, Q1 inventories, April building approvals and April credit data all on tap. Note Q1 GDP prints on Wednesday.
  • In local politics Peter Dutton was confirmed as the new Liberal party leader and will be the leader of the coalition against the Labor government.

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