AUD, Markets Flourish As Risk Appetite Outpours
The Aussie currency started the week on a positive note as risk appetite soared. Commodity markets got a leg up after last week’s collapse.
The underlying fundamentals for the Australian dollar remain robust, while the RBA leaves interest rates unchanged. Although the domestic jobs data released last week was strong, the central bank has already stated that it will not make a rate decision until the first quarter CPI is released in late April.
Futures markets are putting in an 80% chance of an increase at the June meeting. The US Federal Reserve, however, has already begun raising interest rates on Wednesday.
Meanwhile, iron ore prices surged amid spiking Covid-19 cases in major cities in China. The conflict in Ukraine continues to influence the markets and shifts in risk sentiments could either strengthen or hamper AUD/USD.
The Aussie dollar has the booming commodity prices and the increasing interest rates tailwinds at its back. Its winning streak last week signals that bullish momentum is just around the corner.