Yesterday the Australian Dollar reached a six-week high against the US Dollar, as the global economy continues to attempt to navigate through the Coronavirus pandemic. Whilst the US currently has the highest global death count of any nation so far, Australia appear to be one of the nation’s most in control of the crisis and this could be attributed to the AUDGBP rate strengthening throughout April.
Over the weekend the Australian government have released a new app which will help health authorities to track those who are most likely to contract the virus by tracking their movements. There has been controversy around data protection laws, but if the app helps keep the virus infection rate down, then it is likely the AUD will continue to soar. There have been hints that lockdown measures across Australia could begin to be relaxed next month and if that’s the case and the economy is on track sooner than others, we could see further spikes to take advantage of for clients selling AUD.
USD weakens as Consumer confidence falls three months in a row
The negative impact of the current crisis on the US economy was highlighted on Friday after US consumer sentiment fell for a third straight month. So far it is estimated that more than 26 million jobs have been lost in the US as a result of the pandemic, and these losses have ignited calls to re-open the economy. However, reopening too soon could cause a second wave and further lasting implications as highlighted by Richard Curtin, chief economist for surveys for consumers, “the necessity to reimpose restrictions could cause a deeper and more lasting pessimism across all consumers.”
Donald Trump’s most recent comments regarding the injection of disinfectant as a treatment for the virus are unlikely to do much for confidence, and his storming off stage in his briefing last week are likely to continue to cause volatility for USD exchange rates.
Data this week that could impact AUDUSD exchange rates
This week there are several data sets due to be released that could create movement on the AUDUSD currency pairing. In the early hours of Wednesday morning, Australia will release their inflation figures for Q1. Later in the afternoon sees preliminary GDP figures from the US released for Q1, followed by the Federal Reserve’s latest interest rate decision that evening. At their last meeting, the Fed cut their base rate dramatically from 1.25% to 0.25%, in a move that was similar across the globe. These data sets will give a good indication of how each economy has performed through the crisis, particularly the US, and are likely to have a significant impact on AUDUSD rates. Keep in contact with your account manager to find out how these events affect your upcoming currency transfer needs.
Get in touch using the form below to discuss these factors in more detail, and how they could impact your upcoming currency exchange involving the Australian dollar or euro. I’ll be happy to get in touch and assist you.