Aussie dollar continues to trade below 68 US cents
Daily Currency Update
On Friday the Australian dollar rose more than 50 pips as it rallied from the multi-year low it hit on Thursday at 0.6696. The Aussie dollar closed the week hovering around 68 US cents far from the recent low but still negative for the week. The weekly close could be the lowest since May 2020. Last week the Australian dollar got little help from stellar jobs to report on Thursday and the Reserve Bank of Australia might have to raise rates by a lot more than 50 basis points at their next meeting in August. The June unemployment rate came in at 3.5% against the 3.8% forecast and 3.9% previously. The overall change in employment for the month was a massive 88.4k instead of the 30k anticipated. Full-time employment increased by 52.9k, while 35.5k part-time jobs were added in June.Looking ahead this week and there are no scheduled releases today. On Tuesday all eyes will be on the Reserve Bank of Australia (RBA) Monetary Policy Meeting Minutes providing in-depth insights into the economic conditions that influenced their decision on where to set interest rates. On Thursday we will see the release of the NAB Quarterly Business Confidence a survey of about 1,000 businesses that asks respondents to rate the relative level of current business conditions and expectations for the near and medium-term future. On Friday we will see the release of Purchasing Managers' Index (PMI).
Key Movers
On Friday the US Department of Commerce reported that US Retail Sales rose by 1% YoY, exceeding expectations of 0.8%, and also left behind May’s dismal reading of -0.3%. The University of Michigan Consumer Sentiment came better than expected, with the index toping 51.1 vs. 49.9 estimated. The positive in the report is that inflation expectations tempered, with consumers seeing inflation at 2.8% over a 5-year horizon, lower than 3.1% in June.US Stocks rallied on Friday in response to a new round of bank earnings and promising economic data as fears of a 100 basis point rate hike from the Federal Reserve to subdue rising inflation subsided. The Dow Jones Industrial Average rallied 658.09 points, or 2.15%, to settle at 31,288.26. The S&P 500 jumped 1.92% to 3,863.16, and the Nasdaq Composite bounced 1.79% to 11,452.42. Despite Friday’s rally, all the major averages closed out the week with losses. The Dow slipped close to 0.2% while the S&P and Nasdaq fell 0.9% and nearly 1.6%, respectively.
Expected Ranges
- AUD/USD: 0.6700 - 0.6900 ▼
- AUD/EUR: 0.6600 - 0.6800 ▼
- GBP/AUD: 1.7300 - 1.7500 ▲
- AUD/NZD: 1.0850 - 1.1050 ▲
- AUD/CAD: 0.8700 - 0.8900 ▼