- AUD / USD fails to break through the peak in late March, witnessing a profit reservation.
- RBA’s optimistic statement, signals to reduce support joined the risk sooner.
- Updates from Japan and New York question the early hopes of reducing fears related to coronaviruses.
- Housing finance data in Australia may offer an intermediate direction, viral updates remain the key.
AUD / USD continues the recent decline from its week high as it fell to 0.6170 at the start of Wednesday’s Asian session. Earlier, the pair applauded the general weakness of the US dollar amid risk, but failed to hold on to gains.
The first hopes have faded…
While a slight weakness in the number of coronaviruses (COVID-19) in global hot spots has raised early hopes, recent updates from New York, suggesting a daily record, preceded by negative signals from Japan, have checked the optimists.
Globally, the number of confirmed cases has exceeded 1.38 million, the number of deaths having exceeded 78,000, according to aggregated data from Johns Hopkins University. As for the United States, there are more than 370,500 confirmed cases and more than 11,000 deaths while New York recorded the highest number of deaths of 731.
In Japan, Prime Minister Shinzo Abe announced an emergency in seven provinces, including Tokyo, while touting a huge economic package, almost 20% of GDP, to fight the disease.
Figures from the UK followed in New York’s footsteps, with an increase in the death toll to a record 786, while figures from Spain also withstood the four-day losing streak previous and the death toll.
Political measures still on the cards …
While the RBA has not announced any rate cuts as expected, with an optimistic tone and signals to reduce the huge stimulus if necessary, which is less likely, U.S. policymakers have recently offered small loan indexes businesses. The second round of aid plans is also on the agenda, as US President Donald Trump and House Speaker Nancy Pelosi suggested on Tuesday.
In the midst of all this, the risk tone of the market seems to dampen the previous strength with the Wall Street benchmarks closed in the Red Sea while the 10-year US Treasury yields also reduce the gains to 0.726%.
In the future, investors will pay particular attention to Australian home loans and investment loans for houses for the month of February, published at 12:30 a.m. and 1:30 a.m. GMT respectively, for the intermediate indices. However, general management will be guided by virus updates.
Despite closing above a 21-day SMA level of 0.6075, the quote has not yet closed the high on March 31 near 0.6215 which holds the key to a new rise towards 0, 6300 and the high of mid-March near 0.6330.