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Fluctuations in AUD/USD have meant that this currency pair is broadly at the point at which it started the day, as the aussie fails to take part in the broad ‘risk-on’ rally being seen in equity markets.
It would appear that growth worries remain, in the FX market at any rate, and this has meant that traders remain reluctant to push the aussie higher. An in-line report on private lending in Australia did little to help matters, but continuing expectations of easing by the Federal Reserve meant that AUD/USD was able to find support. Further comments from Charles Evans of the Chicago Fed, who said that the Fed must keep a strong commitment to hold rates low, also boosted sentiment towards the aussie. If the US returns to a course of QE, then the attractions of the aussie dollar, with a fairly high interest rate, and a strong connection to the still-expanding economies of Asia, will become evident once again.
