A$ Lagging G10, Despite Resilient Survey Results

The A$ is the weakest performer in the G10 space so far today. The currency is at fresh lows for the session sub 0.6870, around 0.30% below NY closing levels. The pair has struggled a few times ahead of 0.6900, which is where the 50-day MA comes in (0.6897), so this may be a near term resistance point. The majors are generally firmer against the USD so far today, although overall gains are modest.

• A$ weakness has coincided with a modest rebound in USD/CNH (back above 6.9250). China equities are modestly higher, but still underperforming the broader global trend. Domestic Covid headwinds, amid a fresh lockdown near Beijing, and the spending outlook, remain focus points.
• In terms of metal prices, sentiment is still holding up though. Iron ore is slightly higher on the day ($102.65/tonne), while copper is still above $360 at this stage (CMX basis).
• AU yields are down slightly. This is in line with US moves, leaving the AU-US 2yr spread at -57bps, levels similar to yesterday.
• Earlier Australian survey data painted a fairly resilient backdrop for the economy, with consumer and business sentiment improving, albeit with signs that cost pressures are easing (see this link).
• AUD/JPY is back below 98.00 (last 97.85), while AUD/NZD is back close to 1.1200, well within recent ranges.