Australian Dollar Gains on Hopes for US-China Trade Deal

The Australian dollar rose against other most-traded currencies today. With domestic macroeconomic data being a mixed bag, it is likely that the currency found outside support for its rally. Market analysts speculated that the Aussie gained on optimism about the US-China trade talks, though it is important to note that today’s headlines provided conflicting reports about the progress in the negotiations.
The Australian Bureau of Statistics reported that the number of home loans increased by 1.8% in August from the prior month on a seasonally adjusted basis. That is a slower rate of growth than 3.6% predicted by analysts and 5.5% registered in the previous month (revised up from 5.0%).
Consumer inflation expectations reported by the Melbourne Institute rose from 3.1% in September to 3.6% in October.
The news about the Sino-US trade negotiations was extremely confusing. Some sources claimed that the talks will be limited to just one day, whereas previously it was planned that the meeting will last from Thursday to Friday. US officials dismissed that report later, but it is still unclear whether the negotiations will continue tomorrow. Meanwhile, reports that Washington is ready to make some concessions to Beijing improved the traders’ mood, and that is likely the reason for the Aussie’s rally.
AUD/USD jumped from 0.6722 to 0.6762 as of 14:20 GMT today. EUR/AUD declined from 1.6308 to 1.6280, retreating from the daily high of 1.6370. AUD/JPY advanced from 72.25 to 72.98, bouncing from the daily low of 71.84.

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