Aussie reverse its recent gains after US GDP data released

The Aussie had its feet swept from under it once the US GDP figures were released on Friday.

After finishing onshore around the 0.7600 level, the Aussie slowly grinded out a further push higher to reach 0.7615 around the time the US GDP figures were released. These figures came in just under the expected level, instantly dispelling the rumours that the data was going to be very weak. This saw the greenback quickly rally across the board driving the Aussie lower to register its overnight low of 0.7565. From here the Aussie has come under pressure in our time zone today and has slipped towards 0.7540.

Our cross rates had a mixed bag of results. The euro and Sterling crosses were slightly lower, while the Yen and Kiwi crosses were slightly lower, while the Yen and Kiwi crosses were up. Every currency suffered from the rally in the greenback though.

The slide seen on Friday may only be the beginning of the Aussie Dollar’s woes. This week sees a number of domestic releases and a RBA interest rate announcement. This combined with US data will make for a volatile trading week. There will be a slight reprieve today though as it’s a bank holiday in NSW, removing many of the domestic traders from the market today.

Importers will be banking on tomorrow’s Trade Balance coming in relatively strongly. A worse than expected negative number will erode what support the Aussie currently has, seeing yet another slide toward the 0.74’s and beyond. Upside moves will be reliant on weak US employment data Friday.