Australian Dollar Under Pressure
July 14th, 2009 Posted in Analyst Picks, Currencies
Name: Ashley Smith
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The Australian Dollar (AUD) rose from a six week low against the USD late Monday after a rally in the U.S. stock market encouraging demand for higher yielding assets, and hitting a high of $0.7887. The AUD tumbled last week after the release of worse-than-expected U.S. employment data prompted a return to risk aversion.
Putting further pressure on the AUD were political tensions in China, Australia’s largest trading partner. However, as second quarter earnings from the U.S begin to get published, global stock markets seem to be cheering up, turning investors to higher yielding currencies such as the AUD.
With no major economic data expected from Australia this week the currency’s movement will depend on data from the U.S. as well as movements in major U.S banks and industrial stocks.
While cautious optimism seems to have returned ahead of higher than expected second quarter earnings released by Goldman Sachs, the mood is still very shaky, with greater emphasis on negative news; therefore, any mild reports are likely to curb the Aussie’s recent rally.
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Tags: AUD forecast, AUD trading, AUD/USD, Aussie, Aussie Dollar, Australian Dollar, Forex, Forex Strategies, Market Forecasts, weekly predictions
