Remains Under Pressure From Coronavirus Concerns

A stronger greenback once again put pressure on AUD/USD, the pair dropping as low as 0.7392, the lowest since December 2020. The local COVID-19 will likely keep pressure on AUD, the NSW Premier refused to rule out further restrictions over the weekend as case numbers on Saturday rose to 105. The weekend also saw the NSW Premier tighten non-essential & construction work restrictions across Greater Sydney, with some tighter movement restrictions also issued across 3 areas of the city. Major local banks have started rolling out support packages for customers as a result.

• There could be tailwinds for AUD from iron ore, data late on Friday showed Port Hedland iron ore exports rose to the second highest monthly volume ever at 50.4m tons.
• From a technical perspective AUD/USD traded lower Friday and breached support at 0.7410, the Jul 9 low to confirm a resumption of the downtrend. The break lower maintains a bearish price sequence of lower lows and lower highs and the pair is weaker within the bear channel drawn off Feb 25 high. The channel base is at 0.7360. Initial resistance is at 0.7503, the Jul 13 high. Clearance of this level is required to ease the current bearish pressure.
• There is no domestic data on the docket today, markets will look ahead to RBA minutes tomorrow.