Flat Finish

Spot AUD/USD finished essentially flat, a blip higher in the European morning was followed by a move lower after comments from Fed's Clarida before the move was eroded. Clarida floated the idea of discussing tapering at coming meetings, but said data would be the driver of any decisions. He also noted that inflation would prove to be largely transitory.

• There is likely to be some focus on the number of COVID-19 cases today after gathering restrictions were imposed in Melbourne with at least nine cases found in the second most populous city. PM Morrison's government is under pressure to accelerate the vaccine rollout with around 3.6m people having the first jab so far, around 14% of the population.
• Commodities prices continue to fluctuate after several mentions of a crackdown in China. CBA says "China's National Development and Reform Commission released a five-year plan to better handle abnormal iron ore and copper price changes. High metal prices are a pain point for policy‑makers in China from time to time. But it is unclear if the proposals will be able to cut prices."
• From a technical perspective AUD/USD remains in a range. A bearish theme dominates though following the recent move lower to 0.7688 on May 13. A firm support zone has been defined at 0.7688-75, the latter is the May 4 low. Clearance of this support would strengthen a bearish case and signal scope for a deeper pullback towards 0.7586, the Apr 13 low. Initial firm resistance is at 0.7813, May 18 high ahead of the key resistance at 0.7891, May 10 high.
• A few releases on the docket today, Australia April Westpac Leading Index is due at 0130BST/1030AEST, while the highlight is Australia Q1 Construction Work Done at 0230BST/1130AEST.