The Aussie dollar was once again a big loser on the week on both the continued global risk aversion environment induced by the coronavirus, and weak economic updates from Australia.
Australian Headlines and Economic data
- Australian government stimulus package promises financial support ‘as fast as possible’
- Massive risk-off sentiment right the start of the week after Saudi Arabia stuns the world with massive oil discounts in all-out price war. This was likely catalyst for traders to move quickly out of risk assets right at the open, and a very big spike lower in the Aussie against most of the majors.
- NAB: both business confidence and conditions declined in February
- Australia’s Morrison warns coronavirus hit could be worse than GFC amid recession predictions
- Australian gov’t unveils $1.6B AUD plan to combat coronavirus impact
- Australia’s Westpac consumer sentiment index sank 3.8% in Mar
- RBA deputy governor says Australian government’s stimulus package ‘will provide welcome support’
- Low rates will help economy, even if not straight away: RBA
- Global risk aversion sentiment picked up early in the Asian session to send the Aussie broadly lower after news of U.S. travel restrictions from Europe, and on the likelihood traders were disappointed that the ECB didn’t do more to stimulate the economy (i.e., no expected rate cut) in their latest monetary policy actions.
- Australia announces $17.6B economic stimulus’
- Melbourne Institute: Inflation expectations static, pay expectations remain weak in March
- Australian gov’t bans mass gatherings to prevent virus spread – this may have contributed to the Aussie’s broad move lower on the session (less economic activity likely with social distancing), but it’s also likely the Aussie was another victim of broad U.S. dollar strength (demand for dollars growing on U.S. government stimulus actions and on safe haven flows).