AUD/USD sits tightly past-0.7100 amid mixed catalysts
- AUD/USD keeps the trading range between 0.7130 and 0.7155 off-late.
- Australian Treasurer Frydenberg and Financi Minister Mathias Cormann provide details of fiscal and economic outlook.
- Aussie NAB Business Confidence dropped -15 versus -8 forecast in Q2 2020.
- US-China tussle back in motion, uncertainty over US fiscal package, virus woes trouble traders amid a light calendar day.
AUD/USD recedes to 0.7135 while staying inside the immediate 0.7130-55 trading range during Thursday’s Asian session. The pair recently reacted to National Australia Bank’s (NAB) Business Confidence gauge for the second quarter (Q2). Earlier during the day, Aussie economic forecasts and the Sino-American tension probed the bulls near the highest since April 2019. Though, a lack of major data and off in Japan seems to restrict recent market moves.
Australia’s NAB Business Confidence slipped well below -8 and -12 revised prior to -15 QoQ during the Q2 2020. This adds to Aussie Treasurer Josh Frydenberg’s forecasts of -3.75% read GDP for the 2020 calendar year. Additionally, Australian Finance Minister Mathias Cormann’s comments that the backdrop of an economic and fiscal outlook remains highly uncertain offers an extra burden on the pair. However, the US dollar weakness amid uncertainty concerning fiscal package and the surge in the coronavirus (COVID-19) worries, limit the quote’s further downside.
Recently, the market’s risk-tone sentiment soured after the US ordered Chinese Consulate to leave Houston. The move was harshly criticized by the dragon nation, as expected, which in turn pushed American diplomats to evacuate the Wuhan office.
Talking about the virus, Victoria has recorded five new deaths from coronavirus and 403 new cases on Tuesday. On the other hand, US new cases are inching closer to a 4.0 million mark and defy vaccine hopes.
Amid all these catalysts, S&P 500 Futures alternate gains with losses around 3,270 whereas Australia’s ASX 200 rises 0.44% to 6,100 by the press time.
The pair traders will have to undergo a quiet session ahead of the US Jobless Claims amid a lack of major data/events on the calendar. Though, recent US-China tussle may gain momentum and exert further downside pressure on the AUD/USD prices unless any positive surprises favor the bulls.
Technical analysis
Only if the pair slips below 0.7100, bears can look for further downside, until then 0.7200 remains on the table.