The Australian dollar is the second-strongest currency so far today, behind only the surging Japanese yen.
The gains in the Aussie are more of a function of the global backdrop than anything domestic. Today’s Australian data was a mixed back with retail sales falling short of estimates at 1.1% compared to 1.5% expected. Meanwhile, capital expenditure data was stronger at +0.8% compared to +0.5% expected with building capex particularly strong.
Yesterday, the Australian dollar was dragged down with the kiwi after the RBNZ held rates and signalled no rate changes this year. The poor global risk backdrop also weighed.
Today the mood is better with Chinese stocks higher and that’s led to a modest retracement. AUD/USD was last up 20 pips to 0.6518.