AUD/USD session outlook: Benefitting from ‘reserve currency’ chatter
More reports overnight regarding the AUD reserve currency status, this time coming from the IMF who now formally recognise the AUD and CAD as reserve currencies alongside the existing 5 (USD, EUR, GBP, JPY and CHF). We don’t know exactly what this means in terms of ratio-adjustments by the various central banks but it certainly is bullish for Aussie sentiment. EUR/AUD has taken a fall after the Moody’s decision and the market will look to the Nikkei open and the Tokyo Fix for AUD/JPY leads. Short-term sentiment is bullish so buy dips to 1.0360/70 for another 100-pip grind higher. Medium term I still expect a top to form somewhere near 1.0500 but at some stage all this bullish news for the AUD will come back to bite us bears really hard.
RBA minutes will be released at 00:30 GMT and Governor Stevens is making a speech later today to the Economic Development of Australia annual dinner.