The Aussie pair had a modest upside through much of trade on Monday, pulling back lows from 0.7250 yet was incapable to break back above 0.7300 USD. A largely hawkish tone given by a bunch of major central banks over the past two weeks has fostered a renewed uptick in the expansion narrative. A rise across equities and commodity prices helped push the Aussie higher, with a break back above 0.7300 firmly insight.
Having touched intraday highs at 0.7295 a sustained break above resistance at 0.73 could trigger a move back toward highs seen above 0.74 at the start of September.
The AUD remains ever exposed to a correction in risk demand, and the Evergrande story still lingers as an ever-present risk off threat. To date government entities have taken control of some of the group’s subsidiaries in a bid to protect smaller investors and homeowners yet we are still lacking any real clarity as to whether they will get involved at a higher level and rescue the embattled property giant.
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