When the coronavirus epidemic sent risk assets swooning, the AUD/USD closely followed global equity markets, prompting the RBA to say in their June Minutes "movements in the Australian dollar over the course of this year had been closely correlated with global equity prices." That correlation is breaking down and recent AUD/USD price action suggests that it is correlating with metal prices.
The AUD/USD rose over 1.5% last week despite modest falls on Wall Street and has been resilient this week despite sluggish equity markets nL2N2EZ2IT.
The surging gold price, solid gains in copper and a stubbornly high iron ore price have underpinned the AUD/USD, which is trading close to its 15-month high made on July 22.
If the AUD/USD is going to test and break the 2019 high at 0.7295, it will likely be due to gold breaking above $2,000 per ounce and dragging other metals higher, rather than the S&P 500 breaking above its all-time high at 3,393. nL3N2EZ2TQ For more click on FXBUZ