Australian Dollar Remains Firm

After touching a low of €0.6180 in Feb the AUD/EUR pair has reached a near 5 year high of €0.6560. As we know, this move is on the back of what is currently happening in Ukraine. However this is a great indicator of the market’s view that the economic implications are very much isolated to the EU says Patrick Idquival from Ebury who joins ausbiz for a wrap on the days forex moves. The impact of the crisis in Ukraine has seen a firm rally in commodity prices. This has pulled the Australian Dollar above 4.6 against the CNY, and US$0.73 against the USD he indicates. With the view of limited contagion from the Ukraine crisis, we’re seeing central banks go full steam ahead with monetary policy tightening with the Bank of Canada following through with a 25bps overnight. In my view, in times like this the markets are looking for certainty and predictability when it comes to monetary policy and this is exactly what Powell gave the markets with reassuring statements that we will see a 25bps hike later this month from the fed says Patrick.

Watch the full interview here