Having been glued to the .7050 level for much of Tuesday’s Asian session, the Australian dollar came under renewed selling pressure overnight, weighed down by weaker base metals prices and continued US dollar strength.
As at 8.30am AEDT, the AUD/USD currently buys .7029, having fallen to a low of .7017 in North American trade. It is also down on Tuesday’s opening level of .7044.
“AUD/USD fell overnight on lower base metal prices, rising expectations the Fed will raise rates in December and soft Chinese economic activity that weighed on the commodity complex,” wrote Elias Haddad, senior FX strategist at the CBA in his morning note.
Looking ahead to Wednesday’s Asian session, Haddad believes that the Aussie is likely to remain under pressure, largely on the back of expected weakness in Chinese economic data that will be released later in the session.
“AUD/USD has scope to edge lower today. China’s October economic activity data batch (retail sales, industrial production and fixed asset investment) will likely remain unimpressive, adding to signs that a sustained improvement in Chinese economic activity remains elusive,” he wrote.
Aside from the China data dump, scheduled for release at 4.30pm AEDT, markets will also be eyeing the Westpac-MI Australian consumer sentiment report for November that is due out at 10.30am AEDT.
In October the index rose 4.2% to 97.8, almost entirely on the back of improved sentiment towards the economy and family finances following Malcolm Turnbull replacing Tony Abbott as Australian prime minister. Given the separate ANZ-Roy Morgan consumer confidence survey rose to the highest level seen since January 2014 on Tuesday, there’s a possibility the Westpac index may follow suit today.
Here’s the current Aussie dollar scoreboard.
- AUD/USD 0.7029 , -0.0014 , -0.20%
- AUD/JPY 86.59 , -0.16 , -0.18%
- AUD/CNY 4.4707 , -0.01 , -0.22%
- AUD/EUR 0.6553 , 0.0001 , 0.02%
- AUD/GBP 0.4649 , -0.001 , -0.21%
- AUD/NZD 1.0748 , -0.0033 , -0.31%
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