Opened in Sydney around $1.0434 after a strong rally yesterday from lows of $1.0296 to $1.0450 as strong employment data and later talk of a strong Chinese GDP during the NY session lifted risk appetite. Aussie pushed up to $1.0453 ahead of the GDP release but fell back sharply on the disappointing reading of 8.1% after o/n talk of a reading as high as 9%. The pair fell back to $1.0400 where bids were some solid bids were encountered, but heavy sales in AUD/NZD then added to the move with an extended drop to $1.0383. AUD/NZD plunged from NZ$1.2620 through some large stops at NZ$1.2580 to lows of NZ$ 1.2520. AUD/JPY tumbled from highs of Y84.81 to Y84.14. EUR/AUD jumped from A$1.2620 to A$1.2682 on the back of the move. The GDP release has now turned the tables again on rate forecasts with market now pricing in about 85-90 bps odds of a RBA cut. Aussie stops now sit on a break of $1.0380 and $1.0350.
EasyForexNews Research Team