The Australian Dollar (AUD) has enjoyed has enjoyed somewhat of a rally over the past couple of weeks, pushing up from the six and half year lows that we saw it at against the ‘Sterling’ (GBP) and ‘Greenback’ (USD) earlier this month. It does however still remain vulnerable to further declines without the assistance of positive economic news.
On Friday, Glenn Stevens, Governor of the Reserve Bank of Australia (RBA), made a speech on economics to the House of Representatives. Stevens failed to comment directly on the current value of the AUD but did make reference that the current Unemployment Rate of 6.2% is “too high” despite falling earlier in the month. He also made mention that China’s growth should continue to slow and that there should not be major disruptions in Australian markets resulting from the US Federal Reserve deciding to hike interest rates.
It is a relatively quiet week in terms of domestic data releases out of the Australian economy this week, with the Australian Dollar (AUD) likely to move in response to international economic data releases and commodity price movements. Today is absent of Australian economic releases with consumer sentiment and the House Price Index being announced tomorrow.
Australian Dollar to Canadian Dollar (AUD/CAD) Exchange Rate Recovers From 5 Year Low
The AUD/CAD exchange rate has recovered from the 5 year lows we saw it trading at earlier this month in the 0.91’s. The AUD began its’ rally against the CAD a little over a week ago when the Australian Unemployment Rate fell and was assisted further on Friday evening when the Canadian Consumer Price Index Core (CPI) fell from 2.4% to 2.1% as expected. This allowed the AUD/CAD exchange rate to push north of 0.95.
Due to the absence of data in both the Australian and Canadian economies this week, the AUD/CAD exchange rate is likely to move in response to commodity prices. Positive movements in iron ore and Copper are likely to continue the rally whilst a lift in crude oil prices is likely to provide support for the CAD.
The AUD/CAD exchange rate is currently trading at 0.9502 at 0800 AEST.