- AUD/USD extends bounce off 0.7291 to refresh intraday high.
- US dollar remains on the back foot as jobs report raises doubts over Fed tapering.
- NSW ‘freedom day’, easing in infections keep buyers hopeful.
- US holiday, light calendar restricts immediate moves ahead of key Wednesday.
AUD/USD takes the bids to refresh intraday high to 0.7325, up 0.15% on a day during early Monday.
The Aussie pair began the week on a back foot due to the weekend headlines challenging market sentiment. However, softer US dollar joined hopes of overcoming the virus sooner at home recently favored the bulls.
Having witnessed over 70% vaccination rate, New South Wales (NSW) reopened after over 100 days of the virus-led restrictions. On this occasion, NSW Premier Dominic Perrottet said, per the Sky News, “It’s been a difficult 100 days but the efforts that people have made right across the state, to go out, to get vaccinated, has enabled this great day.”
On the same line, Australian Treasurer Josh Frydenberg tweeted, “The NSW economy is ready for lift-off! NSW success will be Australia’s success, & will reignite the national economy. While our economy has been hit by Delta, we know from previous experiences during the pandemic our economy does bounce back & strongly.”
It’s worth noting that Aussie covid infections have been lower in the last three days, around 2,140 at the latest, which in turn keeps buyers hopeful.
Furthermore, the US Dollar Index (DXY) extends Friday’s NFP-led losses, favoring the AUD/USD buyers, despite fears of the fresh Sino-American tussles over phase one deal commitments and the Aussie-China tensions concerning Taiwan and trade issues.
Amid these plays, S&P 500 Futures prints 0.25% intraday downside, tracking Friday’s Wall Street performance, while the US 10-year Treasury yields remain inactive amid an off in bond trading in the US due to Columbus Day.
Given the US holiday and a light calendar at home, AUD/USD may rely on the risk catalysts for fresh impulse ahead of Wednesday’s Federal Open Market Committee (FOMC) Minutes for the latest monetary policy meeting.
By Anil Panchal for FXStreet