AUD/USD Prints Fresh 2yr Low, Before Finding Support

AUD/USD touched a fresh 2yr low post the Asia close on Friday (0.6764), but we recovered through NY trading, ending the week at 0.6814. We currently track slightly higher at 0.6820.

• Higher US equities and a lower VIX, down to 26.7% from 28.7%, helped lift the A$ off the canvas through the Friday offshore session. AUD/JPY dipped as far as the low 91.40 region, but we rebounded back above 92.00 (last 92.25).
• Commodities remained a headwind, for the most part. Base metals fell a further 2.58%, copper to fresh lows sub $360, and lost 3.25% last week. Iron ore is back to a $113.4/tonne handle. Global growth concerns continuing to weigh. The US Atlanta Fed GDP Nowcaster is now at -2.078%. Oil recovered though, Brent back above $111/bbl.
• US yields were down, the 2 and 10yr off by 12bps and 13bps respectively, but recovered into the NY close. Yield spreads remain a headwind for the A$, although the focus in the early part of this week will tomorrow's RBA decision. A 50bps hike is widely expected.
• Ahead of that today delivers the Melbourne Institute Inflation gauge for June (last was 1.1% MoM). ANZ job ads for June are also out (last 0.4%). Home loans (-2.5% expected, -6.4% previously) are also out for May, along with building approvals (-2.0% forecast, -2.4% last).
• The technical picture remains negative for the A$. The move lower signals scope for weakness towards 0.6759, the 50.0% retracement of the Mar '20 - Feb ' 21 bull cycle. Note on the top side, 0.6979 represents the 20-day EMA.