Finport Currency Brief - Courtesy of Compass Global Markets.
As forecast, the AU$US$ appears to have firmly rejected the lows we called last week and has traded 1% higher overnight, as commodity prices recover and outweighed a healthy US Producer Prices data release. All eyes will be on RBA Gov Lowe this morning and then the US central Bank this time tomorrow; for what is expected to be another hike in interest rates. The move is priced in, however, it's their accompanying rhetoric that will be key. We favour a continuation of the AU$ uptrend.
Elsewhere the Germans are still playing politics with each other and the UK, whilst also releasing lower than predicted German Economic Sentiment data, resulting in a the AU$ back at 1 week highs. The Euro central bank meet Thursday night, Sydney time, so don't expect too much further upside for this pair until then - at the earliest.
AU$GB Pound has also recovered to hit technical trend line resistance that has been in play since October, so we'd therefore also expect these levels to be as good as one could expect, ahead of the Bk Of England meet in 36 hours time.
As previously stated in past reports, price action at this time is particularly volatile. Be prepared and place target orders!
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