Australian Dollar Drops On Rising COVID-19 Cases In Australia's Victoria State
The Australian dollar slipped against its major counterparts in
the Asian session on Tuesday, as virus infections continue to rise
in Victoria and State premier is set to hold a press conference in
relation to further lockdown.
Victoria has reported 191 new coronavirus cases in 24 hours, the
largest single-day increase since the pandemic began.
Premier Daniel Andrews is in a crisis meeting with his ministers
discussing the possibility of another lockdown.
Federal Health Minister Greg Hunt said that a statewide lockdown
would be reimposed if the situation worsens.
Australia's central bank maintained its key interest rate and
the target yield on three-year government bonds unchanged.
The board of Reserve Bank of Australia, governed by Philip Lowe,
decided to maintain cash rate and the targeted yield on three-year
government bonds of 25 basis points.
The bank said it is prepared to scale-up its bond purchases
again and will do whatever is necessary to ensure bond markets
remain functional and to achieve the yield target for 3-year
Australian government securities.
The latest survey from the Australian Industry Group showed that
the services sector in Australia continued to contract in June, and
at a slightly faster rate, with a seasonally adjusted Performance
of Services Index score of 31.5.
That's down slightly from 31.6 in May and it moves farther
beneath the boom-or-bust line of 50 that separates expansion from
The currency showed mixed performance against its major
opponents on Monday. While it held steady against the kiwi and the
euro, it rose against the greenback and the yen.
The aussie pulled back to 0.6955 against the greenback, from
near a 4-week high of 0.6998 set at 8:30 pm ET. The pair had
finished Monday's deals at 0.6973. The aussie is seen finding
support around the 0.65 level.
The aussie pared gains to 74.70 against the yen, from a high of
75.06 seen at 8:30 pm ET. The pair was valued at 74.83 when it
ended trading on Monday. On the downside, 70.00 is possibly seen as
the next support for the aussie.
Data from the Ministry of Internal Affairs and Communications
showed that Japan household spending tumbled 16.2 percent on year
in May - coming in at 252,017 yen.
That missed expectations for a drop of 12.2 percent following
the 11.1 percent decline in April.
The aussie eased to 1.0648 against the kiwi and 0.9427 against
the loonie, after rising to 1.0616 and more than a 1-year high of
0.9464, respectively in prior deals. Next key support for the
aussie may be located around 1.04 against the kiwi and 0.92 against
The aussie touched 1.6266 against the euro, marking a 5-day low.
The euro-aussie pair was quoted at 1.6216 at Monday's close.
Further downtrend may take the aussie to a support around the 1.64
Looking ahead, U.K. Halifax house prices for June will be out in
the European session.
In the New York session, Canada Ivey PMI for June is slated for
AUD vs NZD (FX:AUDNZD)
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AUD vs NZD (FX:AUDNZD)
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