• AUD/USD saw a stunning rebound on Friday, rallying back to the mid-0.7200s as risk appetite improved.
  • That marks a near 2.0% rebound from Thursday’s post-Russia invasion of Ukraine lows.
  • Next week will be busy with the RBA deciding policy, US jobs and ISM surveys and Aussie GDP plus geopolitics.

AUD/USD saw an ultra-impressive rebound on Friday, with the pair rallying back into the mid-0.7200s despite ongoing uncertainty about the European geopolitical landscape and the global economy as fighting between Russian and Ukrainian forces in Ukraine intensified. The pair currently trades in the 0.7330s, up roughly 1.0% on the day, with the Aussie one of the best performing G10 currencies on the session. That marks a near 2.0% rebound from Thursday’s intra-day sub-0.7100 lows.

The recovery on Friday was in part driven by tailwinds the risk-sensitive Aussie received from a rally in global equity markets as traders took a more sanguine view on recent geopolitical events. Traders said sanctions imposed by the West so far on Russia were “soft”, easing fears about energy supply disruptions somewhat, whilst hopes for a diplomatic solution to the war remained. But market commentators also cited healthy dividend payouts from Australian minors, which are normally converted to USD from AUD, as helping support the Aussie throughout the week.

Analysts said the payout could have been worth as much as A$20B, but have not finished, implying the Aussie might be exposed to more downside risks next week. As geopolitical developments in Europe remain front and centre of investors’ minds, next week is likely to remain choppy and headline-driven. But its also a big week for economic data and central bank events. US jobs and ISM survey data for February are due, while down under, the RBA will decide on policy and Q4 Australia GDP figures will be released.

This article was originally published by Fxstreet.com.Read the original article here.

LEAVE A REPLY

Please enter your comment!
Please enter your name here