The dollar continued advancing on Thursday, but pared gains mid-US session and gave up some ground. Despite its recent gains, the greenback remains the weakest currency across the board. Wall Street extended its latest rally, with the three major indexes posting intraday gains and reaching fresh all-time highs. US Treasury yields kept advancing with the yield on the benchmark 10-year note topping 1.09%.
Markets are still hopeful about an economic comeback in the second half of the year, amid coronavirus immunization. Vaccination started on a bumpy fashion, but its slowly extending globally. Monetary and fiscal stimulus underpin high-yielding assets.
Financial markets ignored US political turmoil. Things cooled down a bit on Thursday and the Senate finally validated Joe Biden’s victory. Still, Democrats want US President Trump out of the White House as soon as possible, despite he has only 13 days left at the office. The drama will continue but it seems transition will take place as scheduled next Jan 20.
Overnight Currency Ranges
AUD/USD: 0.7726 – 0.7793
EUR/USD: 1.2245 – 1.2325
GBP/USD: 1.3533 – 1.3625
USD/JPY: 103.19 – 103.95
USD/CAD: 1.2673 – 1.2733
NZD/USD: 0.7226 – 0.7285
AUD/JPY: 80.13 – 80.58
AUD/NZD: 1.0679 –1.0700
The AUD appears to have topped out around the 0.7820 mark, which is where we’d expect to see resting offers lay. Whilst there is nothing to stop the AUD moving higher, it’ll be interesting to see if that level is a roadblock or a speedbump on what seems like an inevitable move to 0.8000.
Overnight trade saw us down to a 0.7726 low, so we expect the support to be staggered in from 0.7735 and then again sub 0.7680
Event Risk Data Today
GE – November Trade balance
GE – November Industrial Production
EU – November unemployment rate
US – December employment report
US – November Wholesale Inventories
CA – December employment report