- Greenback weakens on dismal durable goods orders data.
- Slightly better sentiment helps the pair extend rebound.
The AUD/USD pair took advantage of the broad-based USD weakness on Thursday and closed the day in the positive territory after suffering losses in the first three days of the week. With the improved market sentiment and the unabated selling pressure on the greenback providing a boost on Friday, the pair extended its rebound and rose above the 0.69 mark. As of writing, the pair was up 0.26% on the day at 0.6917 and was virtually unchanged on the weekly chart.
U.S. President Trump’s comments in the early trading hours of the Asian session helped the risk appetite return to markets ahead of the weekend. Trump said he was looking forward to seeing his Chinese counterpart Xi at the G20 meeting and added that he was hopeful to get a trade deal with China “at some point.” Although these remarks didn’t necessarily hint at progress in the U.S. trade talks, it was enough to bring slight optimism to the markets, which could also be seen in the rebound in the 10-year US T-bond yields and the major equity indexes.
Meanwhile, today’s data from the U.S. showed that durable goods orders in April declined by 2.1% following March’s impressive 2.8% growth and weighed on the greenback to help the pair continue to push higher. The US Dollar Index, which rose to its highest level in two years at 98.37 on Thursday, was last down 0.22% on the day at 97.64.
Due to the sharp drop in durable goods orders, J.P. Morgan announced that it lowered the forecast for the second-quarter GDP growth to 1% from 2.25% in the previous estimate.
Technical levels to consider