The Australian dollar to euro exchange rate continues to swing wildly as the coronavirus continues to hammer the currency markets and dealing a heavy blow to the Australian economy. Rates for AUD to EUR have picked up from yesterday taking levels to 0.55 for the pair.
Australian Dollar Stock Markets Tumble
The Australian stock market has tumbled sharply to levels seen three years ago and one of the implications is that the value of superannuation retirement pots have fallen in value in too, highlighting that the coronavirus is having an impact across the whole of the economy down under. All sectors of the economy are being hit and those concerns for the housing market have returned once again especially when considering those who have lost a job due to the coronavirus and cannot pay their rent or mortgage repayments.
Australian Recession Fears
The overall view is that there will be a recession in Australia and like in the rest of the world it is unclear how long that recession will last for. Expectation is for a peak in infections in June leaving some distance before things can even begin to settle down. Those looking to buy or sell Australian dollars with or any other currency would be wise to make contact and look at the different options available to try and take some of the uncertainty out of these volatile currency markets. If however there is a peak in infections in September then this will paint a very different picture for the Australian economy with the prospect of house prices tumbling by as much as 20%.
Eurozone Data a Cause for Concern
The Eurozone has suffered weak Purchasing Managers Index data this week for both the services and manufacturing sectors. Whilst the manufacturing sector slipped into negative territory below the 50 threshold which represents contraction, it was the services sector which tumbled dramatically.
With no major economic data releases today focus moves to EU Consumer Price Index inflation data on Tuesday and unemployment data for March the following day. Coronavirus updates and the markets ability to project the slowdown in growth for both the Eurozone economy and Australian economy will likely dictate the direction of travel for the EUR AUD pair.
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