AUD: A$ Loses Ground On Risk Aversion, But Still Close To Recent Highs

AUD/USD lost a little over 0.40% for Tuesday's session, as most currencies fell against the USD, amid safe have demand after Iran launched missile strikes against Israel. The only G10 currencies to rise were JPY and CAD, although these gains were quite modest. AUD/USD tracks near 0.6880 in early Wednesday dealings, so only modestly off recent highs. Intra-session lows from Tuesday did get to 0.6856 during US trade. 

• Both US and EU markets were weaker in the equity space, the SPX down nearly 1%. Oil prices moved sharply higher, up nearly 4% for both Brent and WTI benchmarks. US Tsys caught a safe haven bid, with benchmark yields 3.6-5.1bps lower.
• The key focus will be on follow action from Israel's side, in terms of broader risk asset spill over to currencies like the AUD. The strikes step up escalations in the region and represent a more significant attack than the orchestrated efforts in April, which were largely thwarted by the iron dome and seemingly at lower value targets.
• For AUD/USD techs, the 20-day EMA is at 0.6800 on the downside. Recent highs at 0.6942 remain intact.
• The A$ was a notable outperformer against NZD through Tuesday trade, as further sell side names revised their forecasts to a 50bps cut at next week's RBNZ meeting. The AUD/NZD cross is up to 1.0960, after hitting fresh highs back to August on Tuesday
• The local data calendar is empty today.