The Australian Dollar experienced a small recovery during the last two days. The AUD has been experiencing a downward trend against all the majors over the last month, reaching over four year lows against the US Dollar (AUD/USD) and the UK Pound Sterling (AUD/GBP).
During last night’s offshore session The Australian Dollar to US Dollar Exchange Rate (AUD/USD) made it back above 82 US Cents temporarily.
The US Conference Board released their consumer confidence Index overnight, which was expected to come in with a result significantly better than the previous month’s figure of 91.0 to a forecast of 94.6. The result was a miss at 92.6 causing some of the sell-off in the US Dollar.
The US will release their Unemployment claims for the week tonight which is expected to be an increase on last weeks figure. If this result comes in as expected we may see the rally in the AUD/USD Exchange Rate continue.
The AUD/USD is currently trading at 81.85 US Cents at 8:00 AM AEST Today.
Greece Election causes Instability in the Euro-Zone
The AUD/EUR has made some minor gains over the last two days trading sessions, making it back into the low 0.67 range. The gains made have been to the same equivalent to the rest of the majors and it appears that the rally is based on profit taking in the AUD rather than Euro-zone concerns.
The current instability in the Euro Zone due to the Greek election appears to have caused limited impact on the Australian Dollar to Euro (AUD/EUR) Exchange Rate. This could also be due to the lack of liquidity in the market during this time of the year. However economic or political news from Greece does not usually cause major currency fluctuations on the AUD/EUR Exchange Rate.
RBC Capital Markets currency strategist Michael Turner said yesterday that thinner trading volumes has had an effect on the Australian Dollar. Explaining that the ‘Aussie was rallying through most of last night [Monday] , it’s come off a little bit today but we’re talking about a fixed-point range over the course of this week.’
There is no significant economic data to drive the market this week out of the Euro-Zone. The Australian side of the currency pairing may be impacted by Chinese HSBC Final Manufacturing PMI today which is expected to remain below the contraction line at 49.5 which would be the same result as last month.
The AUD/EUR Exchange Rate is currently trading at 0.6728 at 8:00 AM AEST today.