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AUD/USD Back Above 50-Day MA

AUD

AUD/USD spiked higher post the weaker than expected PMI data in the US overnight. The currency was wedged underneath 0.6880 but surged to +0.6960 before selling interest emerged. We currently track close to 0.6930. Note we are now above the 50-day MA at 0.6918. The domestic data calendar is empty today.

  • AUD is the second best performing G10 currency over the past 24 hours, bettered only by NOK (which bounced on rising oil prices). As noted above the majority of gains came post weaker than expected US data.
  • US yields dipped but recovered into the close (2yr back to 3.30%), which helped the DXY push back up to 108.50 by the close (versus an overnight low of sub 108.10).
  • This helped bring AUD/USD away from overnight highs, although we still outperformed on most crosses. AUD/EUR rose to 0.6960, fresh highs back to early April. AUD/JPY edged up, but remains sub 95.00 for now.
  • Equities didn't appear to be a major driver of FX sentiment overnight. The US VIX index continued to climb though, now back above 24%. AUD/JPY is showing resilience to rising VIX trends for now, see the chart below.
  • Outside of oil, base metals nudged up, copper to $369 (CMX), while iron ore edged back towards $105/tonne.
  • On the topside, a break back above 0.7040, the August 16th high, is needed to ease current bearish pressure.

Fig 1: AUD/JPY & The VIX Index (Inverted)

Source: MNI/Market News/Bloomberg

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