The Australian dollar is under pressure

Photo by Christian Augustin/Getty Images

The Australian dollar weakened on Tuesday, continuing the topsy-turvy price action that has become a feature of recent trade.

Here’s the scoreboard as at 7.55am AEDT.

AUD/USD 0.7644 , -0.0046 , -0.60%
AUD/JPY 87.08 , -0.34 , -0.39%
AUD/CNH 5.0769 , -0.0169 , -0.33%
AUD/EUR 0.6595 , -0.0028 , -0.42%
AUD/GBP 0.5805 , -0.0032 , -0.55%
AUD/NZD 1.1065 , -0.0003 , -0.03%
AUD/CAD 0.976 , -0.001 , -0.10%

The Aussie lost ground against all the major crosses, especially the US dollar and UK pound, as weaker commodity prices saw traders shun the likes of the Aussie, CAD and Kiwi.

Renewed US dollar strength was also a feature of the session, gaining modestly on renewed optimism over the likelihood of US tax reforms.

“Kevin Brady, the Republican chairman of the tax writing House ways and means committee plans to bring an amended version of their Tax Cuts and Jobs Act for a full House vote next week. Meanwhile, the Senate Finance Committee are expected to unveil their own tax plan on Thursday,” said Elias Haddad, senior currency strategist at the Commonwealth Bank.

Haddad says the tax legislative process is progressing at an “encouraging pace” but he admits that it remains unclear if the final tax package will have enough Republican support to pass through Congress by the end of this year or in early 2018.

On what was an otherwise quiet session, that was enough to push the AUD/USD down by 0.6% to .7644.

AUD/USD Hourly Chart

Looking to the day ahead, it looks set to be another quiet one with very little in the way of major events outside of Chinese trade data for October that will be released around 1pm AEDT.

From a year earlier, exports and imports are expected to grow by 7.2% and 16% respectively, down from the 8.1% and 18.7% increase seen in the year to September.

“From an AUD perspective, the market is trying to glean whether the data signifies steady, faster or slower growth in the Chinese economy (imports) and its interaction with the rest of the world (exports),” says David de Garis, economist at the National Australia Bank.

There are no data releases scheduled in Australia.

The calendar is also quiet in Europe and North America with housing starts and building permits from Canada and weekly crude oil inventory data from the US EIA the only releases of note.

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