- AUD / USD extends Friday’s rally in cautious optimism.
- Australia’s CBA PMI presented bullish data for November, Treasurer Frydenberg suggested an extension of tax breaks.
- The woes of the virus are fighting vaccine / treatment hopes, the fight between the Fed and the US Treasury calls into question the risks.
- US PMIs, virus updates, and news about the Fed / Treasury drama will be key.
AUD / USD climbs to daily high near 0.7320, up 0.11% intraday, during Asian trading on Monday. The pair recently benefited from the positive change in risk sentiment as well as bullish data from Australia.
The Common Wealth Bank (CBA) preliminary manufacturing PMI readings for November broke the market consensus of 54.2 to 56.1, while the services PMI also rose beyond the expected 53.8 to 54 , 9. As a result, the composite PMI crossed 53.5 ahead of 54.7.
Not only the data, but also the bullish impressions of risk catalysts such as the S&P 500 Futures and ASX 200 also appealed to Australian bulls. In addition, news that Australian Treasurer Josh Frydenberg has signaled an extension of the tax cut for domestic businesses, as reported by the Australian Financial Review (AFR), is also helping risk barometers. While portraying the same thing, the S&P 500 Futures prints intraday gains of 0.20% while the ASX 200 challenges late February highs with 0.75% one-day gains at 6589 at press time .
It is hoped that the coronavirus (COVID-19) vaccine / treatment will soon be available to support the risk barometers. After Pfizer’s 95% effective rate, Regeneron obtains approval from the United States Food and Drug Administration for its antibody treatment for emergency use.
However, tension between the US Federal Reserve and the US Treasury over the $ 500 billion recall and its impact on emergency stimulus packages is adding to the sustained rise in global covid numbers to challenge optimists. . The uncertainty surrounding Brexit and the much anticipated COVID-19 stimulus from the United States could also call into question the upward momentum.
Looking ahead, US flash PMIs and risk catalysts are likely to drive short term AUD / USD moves.
Clear break above 0.7340 / 45, including mid-September high and late August low, catches the attention of AUD / USD bulls unless the quote breaks the line of one-week support, at 0.7270 now.