News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • GBP/USD has flattened overnight after its strongest rally in a month on Thursday. The British currency has been under pressure recently as an energy crisis has caused a number of gas providers to go bankrupt. Get your market update from @HathornSabin here:https://t.co/3D8s2eIVWv https://t.co/JDGNwKYyOn
  • Japanese candlesticks are a popular charting technique used by many traders, and the shooting star candle is no exception. Learn about the shooting star candlestick and how to trade it here: https://t.co/mfwJ0sIauS https://t.co/JIT5it2HAt
  • Gold could suffer further near-term losses due to rising U.S. Treasury yields and a weak technical picture for price action. Get your weekly gold forecast from @DColmanFX here: https://t.co/g9QvH3L4It https://t.co/Vz98E0Bl9U
  • Gold has been trending lower after failing to clear resistance in the $1835 area earlier this month. Get your $XAUUSD market update from @DColmanFX here:https://t.co/3hm1g3BHgf https://t.co/MdTQKEBCBx
  • Key break here in the 10-year #Treasury yield as it rises to the highest since late June Took out 1.4230 resistance, and the 100-day SMA Eyes now on the 38.2% Fib extension at 1.4775 Also potential falling resistance from March https://t.co/4cI6l210ui
  • The move in rates after this week’s FOMC has continued and the 10 year yield has pushed up to a fresh two-month-high. Get your market update from @JStanleyFX here:https://t.co/CRWhuZ3sxD https://t.co/svHHqN2Zz8
  • S&P 500 contending with its proverbial ‘line in the sand’ as bulls and bears battle for directional control. How we close/trade around the 50-day moving average could serve as a noteworthy bellwether for risk trends headed into next week. I remain cautious below ~4,480. $SPX $ES https://t.co/qogkjs1Sx2
  • USD/JPY trades to a fresh monthly (110.57) amid the pickup in longer-dated US Treasury yields, and the exchange rate may stage a larger advance over the coming days. Get your market update from @DavidJSong here:https://t.co/dlNXOrJnM9 https://t.co/LCQd26W1zF
  • US yields continue to climb, with the 10-year Treasury yield trading above 1.45% $ZN $ZB https://t.co/N4EDfwD3nZ
  • $USDJPY bull thesis appears quite constructive. Technicals show topside breakout above trend resistance following a period of consolidation. Bond yields providing the fundamental catalyst. Eyes on Aug/YTD highs. A broad-based deterioration in market sentiment poses downside risk. https://t.co/AazskXGjHq
Australian Dollar Outlook: Rising Commodity Prices to Drive AUD Higher

Australian Dollar Outlook: Rising Commodity Prices to Drive AUD Higher

Daniel Moss, Analyst

Australian Dollar Fundamental Forecast: Bullish

  • Australia’s success in suppressing the novel coronavirus and soaring commodity prices may underpin the cyclically-sensitive AUD in the coming months.
  • Consumer confidence and retail sales figures will be keenly eyed to gauge the speed of the nation’s nascent economic recovery.

As mentioned in previous reports, the cyclically-sensitive Australian Dollar seems poised to continue outperforming its major counterparts in the coming months, as the island nation keeps the novel coronavirus at bay and continues to benefit from strong demand for its most valuable export, iron ore. Although a fresh outbreak of Covid-19 in New South Wales and Victoria forced interstate borders to shut down at the tail end of 2020, the number of infections has remained in the low single digits.

Indeed, the implementation of robust contact tracing schemes in the nations two most-populous states has permitted venues to remain open, with mandatory mask-wearing and reduced capacities in indoor settings the only notable adjustments in social distancing measures. This will likely allow Australia to continue its economic recovery relatively unabated.

Australian Dollar Outlook: Rising Commodity Prices to Drive AUD Higher

Source – Bloomberg

Moreover, surging iron ore prices may also underpin the trade-sensitive currency, as the metallic rock continues its historic surge from the February 2020 lows, climbing as much as 116% in the last 12 months.

With Chinese demand notably surging in recent weeks, and a substantial fiscal safety-net in place, this relentless push higher looks set to endure. The Chinese government has yet to unleash trillions of yuan in stimulus, after selling a record amount of bonds last year, which suggests that a more extensive recovery could be in the offing. Therefore, positive local health developments, in tandem with the robust economic recovery seen in China, may put a premium on the Australian Dollar in medium term.

Australian Dollar Outlook: Rising Commodity Prices to Drive AUD Higher

AUD/USD daily chart created using Tradingview

Retail Sales, Consumer Confidence On Tap

Looking ahead, consumer confidence figures for January will be keenly eyed by regional investors, alongside final retail sales figures for November, to gauge the speed of the local economic recovery. Better-than-expected economic data probably underpinning the local currency against its major counterparts.

Australian Dollar Outlook: Rising Commodity Prices to Drive AUD Higher

DailyFX Economic Calendar

-- Written by Daniel Moss, Analyst for DailyFX

Follow me on Twitter @DanielGMoss

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES