Author: George Hopkinson
The AUD/USD pair continued to decline during the American session as the rally of the US dollar persisted and reached a fresh seventeen-year low at 0.5701.
Risk aversion boosted the demand for the greenback as investors continued to rush for liquidity. The US Dollar Index (DXY) broke above 101.00 to the highest in three years. It was holding at the top, as equity prices in the US dropped further.
The Dow Jones has fallen 6.55% and crude oil more than 15%. WTI is near $22.00, levels last seen back in 2003. Saudi Arabia looks to boost oil exports to a record 10 million barrels a day, as the price war between top OPEC oil producers intensifies. Markets remained in panic mode unable to find some calm despite liquidity and fiscal stimulus announced across the globe.
Volatility is set to prevail at extreme levels. The AUD/USD was down almost two hundred pips on Wednesday. Most anticipated event will be the emergency meeting of the RBA scheduled for 2:30pm, markets are expecting them to cut rates to a record low of 0.25% – this will no doubt overshadow any other data releases today and put further downward pressure on the beleaguered Aussie Dollar.
Looking towards today, Australian Employment data is due later this morning along with NZ GDP figures for Q4, but the numbers are largely irrelevant given the current global meltdown. Coronavirus news and developments will continue to be the only big influence on markets.
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