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Aussie Dollar slides further, breaks through 0.6000

Published March 18, 2020

Author George Hopkinson

AUD/USD Bears remain unstoppable as the AUD downside accelerates throughout the European session. The crucial 0.6000 level has been reached and the Aussie printed 17 year lows – last seen in April 2003.

The concern of a large economic slowdown in China is suffocating any chance of the AUD recovering. The RBA meeting minutes did little to disburse fears mainly due to rapidly changing developments in financial markets since the meeting 2 weeks ago; effectively leaving the minutes redundant.

A quick recap of where we stand:

  • The AUD has fallen 15.04% in the last 12 months
  • 4% of that has been in the last week.
  • The ASX/200 suffered its worst fall since the GFC – not once but twice! It was down 7.3% last Monday, then lost 7.4% last Thursday
  • The DOW fell by 10% on Thursday – its worst single day fall since the 1987 ‘Black Monday’ crash

US Treasury Secretary Mnuchin said the US administration would outline its fiscal plan today, with press reports saying that it would be between $800b to $850b (4%/GDP), although it could yet grow larger.

Data released overnight showed US retail sales unexpectedly fall in February, with households cutting back on purchases.  The February number was down 0.5% vs January, compared to market expectations of a 0.2% rise.  The numbers are largely irrelevant given the coronavirus development of the past few weeks.

 

 

Adam Nikitins and Stewart McCallum were appointed Joint and Several Voluntary Administrators of EncoreFX (Australia) Pty Ltd on 30 March 2020.

Rees Logan, Adam Nikitins and Stewart McCallum were appointed Joint and Several Voluntary Administrators of EncoreFX (NZ) Limited on 30 March 2020.

Any queries regarding the Administrations should be directed to encorefx@au.ey.com.