Recovering risk sentiment continues to drive the Australian Dollar northwards at the start of the new week. The Australian Dollar is pushing higher for the 7th straight session.
The Aussie rallied 2.45% versus sterling across the previous week, closing on Friday at 1.9003 after hitting an almost 4 month high of 1.8941.
At 09:30 UTC, GBP/AUD is trading at -0.15% at 1.8962. This is at the lower end of the daily traded range of 1.8944 – 1.9034.
AUD: Risk On Trading Lifts Aussie
The perceived riskier Aussie Dollar has had a spectacular run across April and the start of May as investors continue to focus on the reopening of economies across the globe. Investors are become almost immune to horrible data which has been providing clues as to the extent of the economic hit that the coronavirus outbreak has had.
Trade tensions between the US and China, Australia’s largest trading partner, eased slightly at the end of last week, offering further support to the Aussie dollar. The fragile US – Sino trade discussions had looked to be under threat amid President Trump’s efforts to pin blame of the coronavirus outbreak on China.
Looking ahead inflation data from China and Australian business confidence figures will be in focus in the Asian session.
GBP: Boris Johnson Announces Easing Measures
The Pound was trading broadly higher versus its major peers, albeit lower versus the Australian Dollar as investors cheered the gradual reopening of the economy. Boris Johnson announced the easing of some lock down measures, and a three-step plan to bring the UK out of lock down. Long-awaited visibility of how the UK economy will move forward is lifting demand for the Pound.
Boris Johnson said that those who haven’t be able to work from home are encouraged to return to work today. As a result, construction sites, and manufacturing plant will be opening this week.
UK – EU Brexit trade talks are also resuming today. Headlines from these negotiations could add pressure to sterling as investors refocus their attention on the troubles ahead should the two sides fail to agree to a trade deal.
