A$ Rebounds +2% From Lows, As Broader Risk Appetite Recovers

AUD/USD staged an impressive intra-day rebound overnight. The pair hit a low of 0.6170, post the stronger than expect US CPI print, but surged back above 0.6300 by the tail end of the NY session. This peak to trough move was just under 2.40%. The pair currently sits just below 0.6300.

• In terms of upside resistance levels, note 0.6363 was the low from Sep 28, while the 20-day EMA comes in at 0.6489.
• The A$ ranks near the bottom in terms of G10 performance over the past 24 hours though, only outperforming JPY and CHF over this period. GBP was the best, up over 2%. Lower gilt yields appear to aid broader risk sentiment (as well as sterling).
• The rebound in US equity sentiment was impressive, the SPX ended up 2.6%, while the VIX ended back below 32%, finding resistance above 34% for now. Spot commodity indices were higher in line with the broad recovery in risk appetite.
• There was some chatter around US inflation being closer to a peak, as a contributor to the risk rally, although US nominal yields/Fed expectations held higher levels into the US close. US real yields were down from intra-day highs though, finishing at 1.63%.
• The domestic data calendar is quiet today.