AUD/USD (current price: 0.7401)
The Australian Dollar was probably the strongest “risk-on” currency on Friday, as it was helped by the jump in precious metals and the underlying bullish technical trend. The pair fell back today in early trading to the important support zone near 0.74, as global sentiment remains negative. The Chinese central bank devalued the Yuan yet again this morning, and that might start another decline in stock markets and risk currencies, like it did earlier on this year.
Our assessment: AUD/USD could fall further, despite the relative strength of the Aussie on Friday, as investors are still pessimistic about the global economy.
