Daily Forex Wrap: Aussie Falls To Lowest Level In 10 Days

OverviewOvernight, the USD led much of the price action in what was otherwise a quiet session, with antipodean currencies coming under sustained selling pressure amid the weakness seen in commodities and concerns over growth in China. Notably, AUD fell to its lowest in 10 days amid continued weakness in iron ore and increasing bets of a rate cut by the RBA, while JPY slumped after Japanese IP fell the most since June 2014, with renewed strength in the greenback following after last week’s lower-than-expected revision to GDP led the way lower.

The strength in the USD weighed on major pairs as EUR/USD fell tantalizingly close to breaching the 1.0800 handle to the downside, then bounced off its lowest levels. Concerns over Greece’s liquidity issues exacerbated the move lower in the pair, as the most recent proposal of reforms submitted to European creditors failed to gather sufficient approval. GBP/USD also came under relatively strong selling pressure amid the USD strength and lingering political concerns in the UK. Notably, most recent polls reaffirm the view that both leading parties will fail to win the required 326 seats for a majority.

Looking ahead, tomorrow sees German Unemployment Change, UK and Canadian GDP, as well as a host of Fed officials, with Fischer, Lacker, Lockhart, Mester and George all due on the speaker slate. Finally, tomorrow’s deadline for the nuclear talks on Iran could provide a firm sense of direction in the energy complex.

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