23rd July 2020 - AUD awaits fresh clues amid consolidation near multi-month high above 0.7100


Good Morning,

Market Headlines

Mixed sentiment overnight with recent optimism dented by news of US-China consulate closures. Equity markets saw the S&P500 hit a fresh five-month five hight up 0.6%, while currencies and bonds oscillating remaining relatively unchanged. For Commodities, Brent crude futures dropped 0.1% to $44.25, copper declined by 1.1%, iron ore retraced by 0.4% to $110.65, whilst gold gained 1.4%.

Currencies

AUD/USD: 0.7113 – 0.7184

AUD/EUR: 0.6167 - 0.6209

EUR/USD: 1.1507 – 1.1601

GBP/USD: 1.2644 – 1.2743

USD/JPY: 106.76 – 107.29

USD/CAD: 1.3400 – 1.3482

NZD/USD: 0.6633 – 0.6689

AUD/JPY: 76.01 – 76.86

AUD/NZD: 1.0709 – 1.0743

AUD Thoughts

- AUD/USD seesaws between 0.7130 and 0.7156 after stepping back from fresh 15-month high of 0.7183.

- The latest updates on US-China tussle challenge hopes of further stimulus, vaccine news.

- Wall Street offered mild gains after a volatile session, Gold and US dollar stay on the previous path.

- Aussie NAB Business Confidence, Australian Federal Budget update will be the key to watch.

Markets will keep eyes on Australian Treasurer Josh Frydenberg’s announcement of the Federal Budget and update on the economic policies to tame the pandemic. Also up in the radar is the NAB’s (Q2) readings of Business Confidence, expected -8 versus -11 prior.

Unless breaking below June 2020 top surrounding 0.7065, AUD/USD prices are less likely to revisit the 0.7000 threshold. On the contrary, odds of its attack to 0.7200 round-figures, near highs marked in late-February and April of 2019, keeps increasing.

Event Risk Data Today

AU: Federal Budget Update

AU: The Q2 NAB Business Confidence Survey

EU: Consumer Confidence

US: Initial Jobless Claims

US: The Kansas City Fed Activity Survey

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