Fundamentals were largely adverse to the Australian dollar, but that did not prevent the Aussie from rallying today. Analysts explained such behavior by the rise of crude oil prices that bolstered currencies linked to commodities, the Aussie being one of such currencies.
The start of the trading week did not look good for the Australian currency, not the least due to the risk aversion caused by yet another nuclear missile test by North Korea. As for Australian economic data, it was not good too, with home loans falling unexpectedly by 0.5% in March on a seasonally adjusted basis. Reports from China, Australia’s biggest trading partner, were not good either, including industrial production that rose 6.5% year-on-year in April, failing to meet market expectations of 7.1%.
Yet all the negative news were unable to overcome the bullish impact of rising crude oil prices. Currently, futures for crude are trading more than 3% above the opening level in New York.
AUD/USD rallied from 0.7390 to 0.7441 as of 10:21 GMT today. EUR/AUD dropped from 1.4782 to 1.4721. AUD/JPY went up from 83.61 to 84.44.
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