It's going to be another wild session for the Australian dollar

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While stocks, bonds and most commodities ripped higher overnight, boosted by the prospect of further monetary stimulus from the likes of the ECB and BOE in the wake of the UK Brexit vote, that bullish sentiment did not flow through to movements in the Australian dollar. It actually closed flat for the session.

The reluctance of the Aussie to rally was surprising given the euphoria seen elsewhere, but one suspects that it may have underperformed in sympathy with the UK pound and euro, helping to strengthen the US dollar as a consequence.

A report from Reuters stating that Chinese authorities may look to weaken the Chinese yuan further this year also played part, sending the Aussie tumbling down to .7370 before recovering in European trade.

A big decline in crude oil futures, along with quarter end window dressing, may have also played a part.

As a result, it’s hard to read much into the price action seen overnight.

The AUD/USD eventually closed the session at .7450, up a minuscule 0.03% on Wednesday’s closing level.

As at 8.25am AEST, it currently buys .7446.

After a relative lull in the economic calendar this week, the new month will herald a swathe of market moving data releases today which will likely generate some further volatility in the Aussie.

Regionally, markets will receive Chinese manufacturing and non-manufacturing PMI numbers for June at 11am AEST, with the separate Caixin-Markit PMI survey following 45 minutes later.

Japan will also release a swathe of economic data, with most attention likely to fall on the May CPI report (9.30am AEST) and quarterly Tankan survey (9.50am AEST) released by Bank of Japan.

Domestically, markets will receive Australia’s manufacturing PMI report for June at 9.30am AEDT along with the monthly CoreLogic house price index 30 minutes later.

Neither will be market moving.

Like Asia, manufacturing PMI reports dominate the European and US calendars this evening.

Here’s how the Aussie is performing against the crosses.

  • AUD/USD 0.7446 , -0.0004 , -0.05%
  • AUD/JPY 76.85 , -0.04 , -0.05%
  • AUD/CNH 4.9632 , -0.0028 , -0.06%
  • AUD/EUR 0.6703 , -0.0002 , -0.03%
  • AUD/GBP 0.5599 , 0.0005 , 0.09%
  • AUD/NZD 1.0433 , -0.0003 , -0.03%

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