AUDUSD Weakens Following Rising US Inflation Expectations

The Aussie underperformed most of the G10, except kiwi and yen, after the higher than expected University of Michigan inflation expectations data resulted in the USD rising to be up 0.6% on Friday. AUDUSD fell to an intraday low of 0.6636 and is currently around 0.6642.

• Aussie sentiment was not as positive later in the week but its test of 0.6806, the April 14 high, reinforced the bullish theme. But if AUDUSD continues trending down, then this bullishness could be vulnerable. The bear trigger is 0.6565.
• AUDNZD rose 0.8% to break through 1.07 and is now around 1.0727. AUDJPY is flat at 90.19. AUDEUR is down 0.3% to 0.6122 and AUDGBP is -0.4% to 0.5336.
• A A$28.8bn deal has been struck for Newmont to take over Newcrest Mining to create the world’s largest gold producer.
• Equity markets were mixed on Friday with the S&P down 0.2% but the Eurostoxx up 0.2% and the FTSE up 0.3%. Oil prices also fell sharply following the higher US inflation expectations data with WTI down 1.1% and are currently holding just above $70 at $70.10/bbl. LME metal prices were down 4.1% on the week but up 0.8% on Friday. Iron ore is holding above $100 at around $102/t.
• There are no data or events in Australia today. The focus of the week is likely to be on Tuesday’s RBA minutes and Thursday’s employment report.