The ‘Aussie’ has been an uncertain prospect overall of late, having been reduced in appeal by the latest metal price shifts.
The US Dollar has also had a strong influence on the Australian Dollar, with the threat of a US interest rate hike currently overshadowing its commodity-based competitor.
The appeal of the Australian Dollar has been severely limited recently, owing to damaging resource developments and a wider concern that the US could be putting pressure on Australian exporting capabilities in the coming month.
In the former case, the price of precious metals have limited the appeal of the ‘Aussie’. While the cost of platinum has increased slightly, the value of both copper and gold has continued to make clear downward movement.
Regarding the US, recent comments from a Fed official have concerned investors considerably, given that they seem to point strongly to a US interest rate hike taking place in mid-June.
The ‘Buck’ has been a somewhat safer option than the Australian Dollar recently, although domestic data has put something of a dampener on recent market sentiment.
The big news of late has come from Fed official Eric Rosengren, who has argued that:
‘I would say that most of the conditions that were laid out in the minutes [for an interest rate hike], as of right now, seem to be…on the verge of broadly being met’.
Going against the perceived hawkishness within this comment, however, has been the most recent piece of US domestic data, concerning the preliminary manufacturing PMI for May. Forecasts had initially been for a rise from 50.8 to 51, though the actual result was a dip to 50.5 points.
The near-future will bring a speech from a Federal Reserve official; Patrick Harker is due to give comments on economic outlook imminently.
A few hours after this will be Australia’s like contribution, in the form of a planned speech from Reserve Bank of Australia (RBA) Governor Glenn Stevens.
The Australian Dollar to US Dollar (AUD/USD) exchange rate has been trending in the region of 0.4987 and the US Dollar to Australian Dollar (USD/AUD) exchange rate was trending in the region of 1.3859 recently.
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