A$ Outperforms As Debt-Ceiling Issue Almost Solved

The Aussie was buoyed by stronger equity markets driven by increased optimism that a debt-ceiling deal would be made. It has been but now needs to pass through both houses. AUDUSD is up 0.3% to 0.6525 down from Friday’s intraday high of 0.6552. The USD index rose off its lows to finish the day flat.

• The AUDUSD broke through 0.6565, the March 10 low, last week. This confirms the resumption of the bear cycle that started on February 2 and highlights a range breakout. Initial support is at 0.6491 and resistance at 0.6574, the April 28 low.
• Aussie is flat versus the pound at 0.5283 but up against other major crosses. AUDNZD is 0.5% higher to 1.0780. AUDJPY is up 0.8% to 91.82 and AUDEUR +0.3% to 0.6083.
• Equity markets were higher with the S&P up 1.3% and the Eurostoxx +1.6%. S&P futures are up strongly on the debt-ceiling deal. WTI oil prices rose 1.5% to $72.67/bbl. LME metal prices rose 1.5% on Friday to be down 0.5% on the week. Iron ore is back above $100 again at $101.30/t.
• There are no events scheduled in Australia today. The US and UK are closed. The focus of the week is likely to be RBA Lowe’s appearance and April CPI data on Wednesday.