A$ Hits Fresh Cyclical Lows

AUD/USD printed fresh cyclical lows at 0.6262, before stabilising somewhat. It remains the weakest performer within G10, although A$ weakness is dragging NZD/USD lower as well. The regional equity risk off trade and lower US futures (-0.50%), are continuing to weigh.

• In terms of downside levels, beyond potential support at 0.6250, is the next big figure at 0.6200, which was last seen in early April 2020.
• Earlier, the NAB business survey release painted a resilient picture for current growth conditions, although suggests cost/wages pressures may have peaked (see this link for more details).
• To the extent this drives a wedge between the RBA and offshore central banks in terms of the policy outlook, it should continue to undermine the AUD.
• The AUD/NZD cross is finding support sub 1.1300 (last 1.1305).