Asia-Pacific Market Rally Expected to Push the Australian Dollar
The overnight fluctuations on the Australian dollar seem to put things into perspective for investors. The AUD/USD pair has seen a significant hike that brought the currency to the $0.75 level. The Aussie currency continues the streak following an emerging bullish sentiment for Asian stocks. The positive outlook was provided by the treasury yield that led to the price rise of US stocks recently.
The treasure yield has been gaining for the second consecutive day thanks to the hawkish rate policies put forward by the Federal Reserve of the United States of America. The Federal Open Market Committee’s meeting May assures a 50 point hike given the recent observations of the market. The nods from Federal Reserve Governor Loretta Mester confirm that the feds are about to tighten the monetary policies in view of the increasing inflation within the country. On the other hand, the 2s10s spread gained 22 basis points overnight to mitigate any fear of recession in the market.
A similar movement is found in the recent trajectory of the Australian dollar. The AUD/USD pair seemed bullish in the market recently as it rallied to $0.7500. Although analysts believe that there would be significant resistance to the currency at this level, it likely would not be able to dam it down. If the trajectory is continued, the Australian dollar would easily surpass its highest position at $0.7556 last October. The moving average convergence/divergence (MACD) indicator is also fortifying its position wherein the simple moving average (SMA) moved above the 200-day average. Traders interested in making use of the bullish sentiment for the AUD are looking for the best forex broker in Australia.
However, the ten years bonds of Australia fell short in the market as per the recent reports. On the bright side, the bonds hit the highest position since 2018 prior to plunging below. Analysts claim that the AUD is likely to continue its stride with help from rising yields. Along with this, the rising commodity prices too would help the Central Bank of Australia continue the fortification.
The neighboring Kiwis also rose to 1% lately to break the record set on the 23rd of last November. However, there are some signs of concern as the number of Omicron has peaked in Auckland, New Zealand. Hong Kong’s Hang Seng index climbed 3% up despite having its funds held by China. The situation in Japan and also is not as alarming as it should be in a time of global crisis. This means that a larger part of the Asia-Pacific region is secure from global instabilities. Yet, as Biden is scheduled to visit Poland on the 25th of March, the markets are getting ready for a new round of sanctions against Russia.
