Weekly Roundup: Australian dollar strengthens amid USD weakness

The Australian dollar trended broadly higher through last week’s session, the appeal of the ‘Aussie’ being bolstered by a pullback in the US dollar.

AUD exchange rates also benefitted from easing Federal Reserve rate hike bets. Investors hope a less aggressive Fed could help to relieve some of the pressure on global growth.

However, tempering the Australian dollar’s gains were concerns over a dramatic rise in Chinese Covid cases and fears that more cities could be placed under lockdown.

The ‘Aussie’ opens this week on the defensive as markets have been spooked by the emergence of China’s Covid protest movement over the weekend. Financial analysts have expressed concern over what repercussions the protests could have for the country’s second largest economy.

A speech by Reserve Bank of Australia (RBA) Governor Philip Lowe could provide some lift for AUD later in the week. If he reiterates the bank is open to a 50bps rate hike in the future.