The Australian Dollar to US Dollar (AUD/USD) exchange rate has plunged during Monday’s European session on a day of no news for the ‘Aussie’ and just the beginning of the numerous US weekly economic publications and events.
The Australian Dollar (AUD) dropped by -0.4% against the US Dollar (AUD/USD) during Monday’s North-American session, just one of a number of losses for the Australian currency. Other notable declines have been by -0.5% against the Chinese Yuan (AUD/CNY) and the Euro (AUD/EUR) and -0.6% against the Pound Sterling (AUD/GBP). In terms of gains, only a rise of 0.8% against the New Zealand Dollar (AUD/NZD) has put the ‘Aussie’ in the positive.
In addition to being harmed by the rising US Dollar (USD), the speculators of the Australian economy have been discouraged by the news that 9 in 10 millennial workers want to work in countries other than Australia and New Zealand. Managing Director James Nicholson of recruitment company Robert Walters said of the news: ‘Millennials, or Gen Y, have grown up in a borderless world with greater access to international travel, so their sights are set high to begin with’.
In sharp contrast to the Australian Dollar (AUD), the US Dollar (USD) has gone from strength to strength, rising by 0.5% against the Australian Dollar (USD/AUD), over 0.2% against the Euro (USD/EUR) and the Norwegian Krone (USD/NOK) and hitting 0.8% against the New Zealand Dollar (USD/NZD) and 1.5% against the South African Rand (USD/ZAR). In terms of losses, the ‘Buck’ has been represented by -0.2% against the Swiss Franc (USD/CHF) and -0.6% against the Japanese Yen (USD/JPY).
Most of the US Dollar’s early gains came from residual optimism caused by last week’s consecutive supporting speeches by Fed officials, who expressed that they thought a US interest rate hike would be occurring before the end of the year. In addition to bringing many more Fed official talks and speeches this week, a spate of US data is also due. So far, the annual Personal Consumption Expenditure Core figure for August has grown by 1.3%; bettering the previous consumption growth of 1.2%.
Although in its infancy, it already seems that the US Dollar (USD) will maintain the advantage over the Australian Dollar (AUD) this week. US results are vastly outcompeting Australian results, both in number and magnitude. Most immediately, talks by Fed officials Charles Evans and John Williams are due, and as voting members of the Federal Open Market Committee (FOMC), their input will be listened to with special care by speculators.
The Australian Dollar to US Dollar (AUD/USD) exchange rate was trending in the region of 0.7007 and the US Dollar to Australian Dollar (USD/AUD) exchange rate was trending in the region of 1.4274 today.
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