AUD/USD down 26 pips
The FX market has quickly changed from a beauty contest to searching for the best of a bad bunch.
The US dollar was flying high until CPI flattened out and the UMich consumer sentiment survey fell below the pandemic lows.
The Australian dollar has been a punching bag for weeks because of covid’s surge there but it got a reprieve from the USD slump.
However today it was a double whammy for AUD as local lockdowns extend and key trading partner China is slowing faster than anticipated. Chinese industrial production and retail sales both fell well short of estimates today and the Australian dollar is right back to where it was before the UMich survey.
Is there a better barometer of how markets feel about global growth right now than AUD/USD? Either we hold the recent lows or its’ a long way down to 0.7000.