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Relationships with China – with Australia and the US – will likely remain center-stage after limiting the enthusiasm triggered by vaccine hoes and support from the Federal Reserve, according to FXStreet’s analyst Yohay Elam. The AUD/USD trades at 0.6525 after retreating back from the 0.6600 level.

Also see: The Aussie will suffer Chinese retaliation

Key quotes

“Australia’s disease-related deaths and cases continued climbing at a minuscule rate, allowing for further reopening and a gradual return of sports that Aussie love so much – bullish for the national psyche.” 

“The lack of any adverse developments may be enough to lift the A$ – as China’s steps against Australia are on the sidelines of trade between them. Additional tariffs or harsh rhetoric may weigh.”

“Economists expect the 4.8% annualized fall in the US GDP to be confirmed in the second read. Changes in personal consumption – the main drag – will be eyed. Durable Goods Orders statistics for April will provide a picture of investment in the second quarter.”