The Australian dollar was trading flat against major currencies today. While domestic macroeconomic data released in Australia on Friday was decent, worries and uncertainty made investors reluctant to buy riskier commodity-linked currencies, like the Aussie. Yet currently, the Australian currency has managed to regain upward momentum and is trading above the opening level versus majors.
The Australian Bureau of Statistics reported that the Producer Price Index rose by 0.4% in the September quarter from the previous three months, matching market expectations. Year-on-year, the index fell at the same rate. According to the Reserve Bank of Australia, private sector credit increased by 0.1% in September after showing no change in August. Year-on-year, the indicator increased by 2.0%.
The main driving force for markets remains the upcoming US presidential election on November 3. While currently, Democratic candidate Joe Biden is leading in the polls, it is not impossible for incumbent President Donald Trump to have a surprise victory as it has happened in the previous election. Meanwhile, it is almost guaranteed that a fiscal stimulus package will not be approved before the election. And this is while the number of coronavirus cases is increasing in the United States and worldwide. All those factors discourage traders from acquiring riskier assets.
AUD/USD rose from 0.7030 to 0.7063 as of 12:32 GMT today. EUR/AUD dropped from 1.6602 to 1.6540. AUD/JPY rallied from 73.53 to 73.89, bouncing from the daily low of 73.14.
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