- AUD/USD saw some short-covering moves and sustained USD selling.
- US fiscal stimulus hopes lifted investor’s confidence and undermined the safe-haven USD.
- Dovish RBA expectations could limit gains.
The AUD/USD hit day’s high in the early US session. Bulls now looking beyond 0.71.
Hopes that US lawmakers will arrive at an agreement over a new covid relief package is improving the mood in the market.and undermining the US dollar’s relative safe-haven status. Meanwhile demand for riskier currencies, including the Australian dollar rose.
US President Trump indicated that he was willing to accept a larger aid bill. This raised hopes for a bipartisan-deal on a relief package before the November 3 election. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin will continue talks on Wednesday.
Investors are still cautious over the passage of the legislation given the level of opposition from within the Trump Republican Party. This caution was reflected in the equity markets, which could cap gains on any strong AUD/USD rally.
Rising expectations that the RBA will cut interest rates in November could keep investors from placing aggressive bets. Waiting for strong follow-through buying before buying the AUD/USD pair could be prudent
Currencylive.com is a news site only and not a currency trading platform. Currencylive.com is a site operated by Wise US Inc ("We", "Us"), a Delaware Corporation. We do not guarantee that the website will operate in an uninterrupted or error-free manner or is free of viruses or other harmful components. The content on our site is provided for general information only and is not intended as an exhaustive treatment of its subject. We expressly disclaim any contractual or fiduciary relationship with you on the basis of the content of our site, any you may not rely thereon for any purpose. You should consult with qualified professionals or specialists before taking, or refraining from, any action on the basis of the content on our site. Although we make reasonable efforts to update the information on our site, we make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up to date, and DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Some of the content posted on this site has been commissioned by Us, but is the work of independent contractors. These contractors are not employees, workers, agents or partners of Wise and they do not hold themselves out as one. The information and content posted by these independent contractors have not been verified or approved by Us. The views expressed by these independent contractors on currencylive.com do not represent our views.