The Aussie dollar made some gains against the major currencies this week, thanks to both positive risk sentiment dominating early, and likely on the net positive sentiment updates from Australia.
Australian Headlines and Economic data
The big market driver of the week came on Monday from Pfizer / BioNTech, announcing that their COVID vaccine is more than 90% effective. This sparked a big risk-on move across the financial markets as traders priced in the odds of an economic recovery coming sooner rather than later. This sentiment did fade by the Monday U.S. session, but lingered on to influence the markets through most of the week. The Australian dollar spiked higher against most of the majors on the news, along with other risk assets.
Australian business confidence jumps to highest since mid-2019 – “Sentiment climbed to 5 points in October from -4 a month earlier, National Australia Bank Ltd. said Tuesday in a statement. The conditions index — which measures hiring, sales and profits — edged up to 1 from zero in September.”
Australia may open borders to Asia, parts of China, as cases dwindle – “Canberra’s consideration to ease travel curbs and revive tourism comes as the country has recorded three days without any local Covid-19 cases”
Australia Nov consumer sentiment jumps to 7-yr highs – “The Westpac-Melbourne Institute index of consumer sentiment released on Wednesday added 2.5% in November from October, when it had climbed 11.9%.”
The Aussie dollar shifts lower during the Thursday session, likely a move supported by a broad shift in risk sentiment. It’s likely traders were coming off vaccine news highs and focusing on the rising COVID cases in Europe and the U.S., as well as the falling odds of a new stimulus bill coming from the U.S. government.