AUD/USD Just Off Recent Highs, Broader USD Trends, China Data In Focus Today

AUD/USD sits slightly below end NY levels from Friday, last near 0.6780. We couldn't get above 0.6800 through the tail end of last week, but the trend in the A$ remains positive. The currency gained around 0.5% last week, although was mid range from a G10 standpoint (JPY +1.85%, GBP +1.35% were the best performers).

• Early focus this week will rest on Trump election odds, which have firmed following the weekend assassination attempt. Early USD gains have been attributed to firmer Trump election odds in the first part of Monday dealings.
• Against this though is Fed cutting odds, which are closed to fully priced in terms of an easing at the September meeting.
• AUD/USD has rallied with rising AU-US short term yield differentials in the first part of July. The 3 month differential (in 1yr's time) sits at +42bps, highs back to January of this year. Upside focus will be on 0.6839, the Jan 2 high from this year. The 20-day EMA sits back at 0.6694.
• Cross asset sentiment was positive in the equity space on Friday, with US and EU markets rallying, aided in part by US Fed expectations. Commodity indices were flat in terms of the Bloomberg aggregate, while the metal sub index rose 0.72%.
• The local data calendar is empty today, but be mindful of spillover from China data outcomes, with Q2 GDP and June monthly activity figures on tap. Later in the week we get Aust employment data as the main focus point. Today also note the following option expiries for NY cut later: $0.6645-55(A$1.1bln), $0.6750(A$599mln).