As you can see on the chart, the consolidation period has ended. The euro began to strengthen against the weakened Australian dollar. In the past few months, the AUD has been under pressure, like most other commodity currencies, due to the spread of a new strain of the Delta coronavirus in the region. Investors are afraid of a new wave of the pandemic and its negative impact on the global economy.
The euro was stronger than many currencies, including the strong USD, with the publication of the most important macroeconomic reports this week. As it became known, the GDP grew by 2% in the second quarter, and unemployment fell in June from 8% to 7.7%. All these indicators exceeded the expectations of investors. The only thing that previously held back the euro was the ECB's monetary policy, which remains extremely soft despite the improvement in the economic situation. Perhaps additional incentives for the economy will really be needed, after the devastating floods in several EU countries in July. Nevertheless, the euro remains the driver for the EUR/AUD currency pair.
Despite the growth of the consumer price index above the forecasts, the Australian dollar remains under the influence of external factors. The Australian economy continues to operate in quarantine mode, as the lockdown is still active in the largest cities. It is also expected that the RBA will not make any changes to the monetary policy. Therefore, we expect the uptrend to continue and we are opening the deals to BUY today. Most technical analysis tools are also recommend to BUY the EUR.
