The value of the ‘Aussie’ against the ‘Greenback’ has been high recently, as with last week, thanks in part to a supportive outcome for the latest business confidence report.
By contrast, the US Dollar has been in a solid state of decline, with recent comments from a Fed policymaker amplifying concerns about a lack of interest rate hiking by the central bank.
The appeal of the ‘Aussie’ had been high on the whole lately, with support being offered by the recent NAB business confidence outcome for June; this has increased above forecasts, rising from 3 points to 6.
In other news, Reserve Bank of Australia (RBA) official Luci Ellis has given a speech, although given that no mentions were made of monetary policy, it seems that at least some of the central bank’s members are not pre-occupied with minute adjustments of the official cash rate.
In less supportive news, the RBA has also released its July monetary policy statement, which has argued that a higher value on the ‘Aussie’ might present difficulties when it comes to economic expansion.
The appeal of the US Dollar has fallen considerably of late, on account of concerns that the nation’s low interest rate is a danger to the economy. This sentiment has been placed in the minds of investors by Fed official Esther George, who has stated simply that:
‘Keeping rates too low can create risks.’
Other US data has also been harmful of late, with the labour market conditions index change for June remaining negative with movement from -3.6 to -1.9.
The only major gain seen for the ‘Buck’ has come against the Japanese Yen.
The near-term for the Australian Dollar will see the announcement of the Westpac consumer confidence outcome for July, which was expected at the time of writing to dip from 102.17 to 101.20.
Following on from this over the course of the day will be a trio of Federal Reserve official speeches, starting in the morning with Loretta Mester. Much later on, during the night, Daniel Tarullo and James Bullard are also expected to make some comments, potentially on how the Fed may act in the short-term on policy decisions in the wake of ‘Brexit’.
The Australian Dollar to US Dollar (AUD/USD) exchange rate has been trending in the region of 0.7640 and the US Dollar to Australian Dollar (USD/AUD) exchange rate has been trending in the region of 0.7593 recently.
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