The three day winning streak in the Australian dollar came to an abrupt end on Friday, falling modestly on the back of renewed US dollar strength.
After hitting a fresh nine-month high of .7680 in Asian trade, the AUD/USD finished the session buying .7599, a decline of 0.64% on Thursday’s closing level.
In early Asian trade on Monday the Aussie has extended that decline, trading at .7593 as at 9am AEDT.
With nothing on the domestic economic calendar arriving today, and Easter fast approaching, Ray Attrill, global co-head of FX strategy at the NAB, suggests that “it threatens to be a quiet week, but at least a four day one”.
“In Australia, RBA Governor Glenn Stevens’ speech Tuesday, at an ASIC forum, looms large in what is an otherwise quiet week with only second tier data only,” says Attrill. “Markets will be on guard for some renewed jawboning on the currency.”
As my colleague Greg McKenna wrote earlier today, RBA staff have been relatively neutral on the currency with RBA Assistant Governor Guy Debelle noting last week that:
Most central banks want lower currencies, to push up inflation or create a bit more activity… I don’t think we’re any different from that. But obviously everyone can’t have a depreciating currency.
On that form it suggests that Stevens may not take the opportunity to use verbal intervention, or jawboning, to lower the Australian dollar when he takes to the stage in Sydney at 4.15pm AEDT on Tuesday.
However, as markets have become acutely aware of in recent years, it’s sometimes best to expect the unexpected when it comes to central bank policymakers.
Here’s the current Australian dollar scoreboard.
- AUD/USD 0.7593 , -0.0006 , -0.08%
- AUD/JPY 84.72 , -0.05 , -0.06%
- AUD/CNY 4.9072 , -0.0027 , -0.05%
- AUD/EUR 0.6736 , -0.0003 , -0.04%
- AUD/GBP 0.5250 , 0.0004 , 0.08%
- AUD/NZD 1.1181 , 0.0014 , 0.13%