The Australian dollar today fell against the US dollar before recovering to trade at breakeven driven by positive investor sentiment and news events. The AUD/USD currency pair today rallied higher as investors bought the Aussie ahead of a gradual reopening of Australia’s economy.
The AUD/USD currency pair today fell to a low of 0.6337 in the late Asian session before reversing course and heading higher to hit a high of 0.6384 and was trading near these highs at the time of writing.
The Aussie’s performance today was primarily driven by investor expectations that a reopening of Australia’s economy would be good for the currency. Investors seem to have discounted the likely problems that could be facing Australia’s housing sector, which was declining before the COVID-19 pandemic. The upbeat investor risk appetite was also evident in the equity markets earlier today, but this did not last. Analysts are expecting inflation data in Australia to rebound in the next monthly print. Still, they opine that the Reserve Bank of Australia will not be raising rates any time soon.
The Aussie’s gains were capped by the stronger greenback as tracked by the US Dollar Index, which hit a high of 100.87 earlier today. The greenback was attractive to investors given its safe-haven status and the significant uncertainties facing the global economy even after COVID-19 lockdowns are lifted.
The currency pair’s performance over the upcoming weekend is likely to be affected by geopolitical events.
The AUD/USD currency pair was trading at 0.6369 as at 17:17 GMT having rallied from a low of 0.6337. The AUD/CAD currency pair was trading at 0.8993, having risen from a low of 0.8934.
If you have any questions, comments, or opinions regarding the Australian Dollar, feel free to post them using the commentary form below.
