Aussie/USD continues providing quite a lot of drama. During its own session, the A$ suffered.
However, thanks to a USD sell off, the pair’s chart looks more like a U than a clear descent.
Why did the Aussie slide?
Westpac’s consumer sentiment dropped by 6.9% in June, reversing a leap of 6.4% in May and returning to negative numbers, as seen also in April and March.
More importantly, RBA Governor Glenn Stevens put all his weight on the local currency by saying that the A$ needs to fall further, even though he admitted that he is not the only central banker who has these wishes.
Adding fuel to the fire, Stevens said that he remains open to the “possibility of further policy easing” – the door is still wide open to more cuts after the recent move to 2% – a historic low.
This sent AUD/USD to dip below 0.7640.
USD sell-off
But all this reversed in the European session. Traders in London and across the old continent got rid of the greenback. One trigger came from yet another rise in German yields and another came from comments from Japan about the excessive weakness of the yen.
These had an indirect effect on the Aussie, which is trading at 0.7770 at the time of writing.
Australia awaits the all-important employment figures. See how to trade the Australian employment change with AUD/USD.
Here is how it looks on the chart:
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