The euro tumbled on Thursday following the publication of some disappointing Eurozone PMIs.
While consumer sentiment remained in negative territory, this still offered evidence that the New Zealand economy is starting to recover from the impact of the Covid-19 crisis.
As the first quarter private capital expenditure index showed a smaller contraction than anticipated, this put a floor under the Australian dollar.
Although growing tensions between the US and China threaten to disrupt the potential for the global economy to recover in the second half of the year, this was not enough to keep AUD and NZD exchange rates down for long.
Fresh volatility is still likely in store for the Australian dollar this week, though, on the back of the Reserve Bank of Australia’s (RBA) latest policy meeting.
Any fresh signs of dovishness from RBA policymakers could put a dampener on AUD exchange rates, even though no change in interest rates looks likely soon.
A sharper contraction in the first quarter Australian gross domestic product reading may also drag on the Australian dollar this week.
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