The Aussie dollar has rebounded to trade in the U.S. at a high of 0.6479 on a number of factors but primarily a slump in U.S. Treasury yields, which pulled down the U.S. dollar. The U.S. Treasury 10-year bond yield marked the largest daily drop in almost a month. Also helping the AUDUSD was the U.S. Dollar Index which fell from its 11-week high, down 1.7% today and a total of 3% in the last two days. It’s largest 2-day fall since 2009. The Australian dollar and the yen were the two leaders gaining against the dollar but all G10 currencies were higher versus the greenback today.
U.S. Commerce Secretary Gina Raimondo will be visiting Beijing next week, which may smooth over U.S.-China relations. Earlier this week, the U.S. removed 27 Chinese entities from its Unverified List, which lifts sanctions from them further pointing to improving diplomatic ties. This helped propel the Aussie dollar to its current high.
The market’s main focus continues to be the Federal Reserve Chair Powell’s speech at Jackson Hole on Friday. U.S. jobs data will also help to give more direction on the U.S. dollar and the sentiment for Friday’s speech.