Australian dollar loses ground as confidence drops

by Chris Becker

The latest NAB Survey of business confidence took the floor out from under the Aussie dollar in this morning’s trade, sending it back to the mid 71’s, wiping out about half the post shutdown news gains:

This puts it back on track to the 69 cent level against USD leading up to next week’s RBA meeting with an inability to breach the downtrend line from the November 2018 high quite telling, although daily momentum is not yet negative:

More ominously, the Aussie/Kiwi cross (AUDNZD) is painting new lows, about to finish the month at a new low and breaking the series of higher lows since the 2014 nadir. This is an important proxy to watch for interest rate development:

Today the PBOC strengthened the Yuan fix again, pushing it down to 6.7356 instead of the weaker 6.7472 from yesterday. This still has offshore Yuan trading at the 6.76 handle but looking to rollover here as news that the Vice Premier is going to meet with Trump to get the latest trade talks moving. Let’s see if he can make any deal at all:

 

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