Send Currency Update for July 22, 2024. This update is designed to help you stay informed with the latest market conditions, key developments to monitor this week, and a review of what impacted the currency markets last week.

In the News This Week.

AUD/USD

• US President Joe Biden's exit from the presidential race increased the odds for former President Donald Trump and boosted investors' appetite for riskier assets.

• Experts argued that Biden’s decision would increase market volatility, though the market reaction has been limited so far.

• Peter Earle, senior economist at the American Institute for Economic Research, stated that investors may seek a safe haven until they can assess Biden’s replacement's policies.

• Dovish Fed expectations prompted fresh US Dollar selling.

• Pairs where AUD is the weaker currency, such as EURAUD and GBPAUD, are now in focus.

AUD/NZD

• AUDNZD remains in a tight trading range between 1.1055-1.1155, looking for direction. 

• The weakening of the AUD hasn’t impacted the AUDNZD rate in the same way as other major currencies. 

AUD/GBP

• Trending downwards since the 10th of July, dropping over 2%.

• Price action on the AUDGBP 1-hour chart touched the lower trend line in this bull run.

AUD/EUR

• The European interest rate decision on Thursday evening was held at 4.25% as expected, though the AUD continues to lose ground.

• The AUDEUR rate has also dropped nearly 2% in the last two weeks, showing AUD is weakening against most of the major currencies.

AUD/JPY

• The AUDJPY rate has dropped from the yearly highs towards the 105.00 mark. This has been a support/resistance point over the last few years so make need some major news to push back below this level.

• The Moving Average Convergence Divergence (MACD) showed flat red bars, indicating a pause in the previous intensified selling activity.

Last week 🗞️ Key Takeaways:

AUD Outlook and Market Performance

• Rabobank predicted continued outperformance for the Australian Dollar (AUD).

• Rabobank anticipated the RBA would raise interest rates twice in 2024, in August and November, to combat persistent domestic inflation.

• Jane Foley, Senior FX Strategist at Rabobank, stated, "Most recent Australian economic data have cemented our expectations for further rate hikes this cycle."

AUD/USD

• The pair started trading weaker around 0.6770 in the early Asian session on Monday, though it regained momentum.

• AUD traded around a six-month high of 0.6798, supported by a weaker USD following softer-than-expected US CPI data in June.

• Expectations for a potential Federal Reserve (Fed) rate cut in September rose.

• Traders awaited the Michigan Consumer Sentiment Index and US Producer Price Index (PPI) for further US economic insights.

AUD/NZD

• The pair traded at 20-month highs following the RBNZ decision last week to hold interest rates at 5.5%.

• The RBNZ signaled a rate cut later this year, pressuring the NZD.

• High inflation in Australia drove strength in the Aussie, with the RBA eyeing inflation data closely.

Gold Price 

• Gold traded near $2,405 on Monday, pressured by higher-than-expected US Wholesale price inflation in June.

• Gold rallied within a range, approaching its May 20 all-time high of $2,450.

• Instead of forming a topping pattern, Gold might have been in a sideways consolidation, pausing within a broader uptrend.

• Short-term, Gold appeared in a sideways trend, with a floor around $2,280 and a ceiling at $2,450.

Things to look out for this week; 

• Wednesday 24th July

  🇫🇷 French Flash Manufacturing PMI - EUR

  🇫🇷 French Flash Services PMI - EUR

  🇩🇪 German Flash Manufacturing PMI - EUR

  🇩🇪 German Flash Services PMI - EUR

  🇬🇧 Flash Manufacturing PMI - GBP 

  🇬🇧 Flash Services PMI - GBP 

  🇨🇦 BOC Monetary Policy Report - CAD

  🇨🇦 BOC Rate Statement - CAD

  🇨🇦 Overnight Rate - CAD

  🇺🇸 Flash Manufacturing PMI - USD 

  🇺🇸 Flash Services PMI - USD 

• Thursday 26th July

  🇨🇦 BOC Press Conference - CAD

  🇺🇸 Advance GDP q/q - USD 

  🇺🇸 Unemployment Claims - USD 

• Friday 27th July

  🇺🇸 Core PCE Price Index m/m - USD 

  
  

AUD-USD 🇺🇸

Rates have had a slow decline since last week at 0.6687.

AUD-GBP 🇬🇧

Sitting 0.5173 the AUD - GBP has continued it’s decrease since this time last week.

AUD-NZD 🇳🇿

Rates have kept within a band of 1.1120.

AUD-EUR 🇪🇺

AUD to the EUR has continued a decline since last week at 0.6138.

If you’d to learn more, reach out to our International Currency Specialist, Ian Cragg from Sebd Payments.

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