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Australian Dollar Strongest amid Risk Appetite, Traders Wait for NFP

June 5, 2020 at 6:30 by Vladimir Vyun

Banjo Paterson on Australian 10-dollar billThe Australian dollar was the strongest currency on the Forex market today, rising to multi-month highs, amid risk appetite that returned to markets. Other riskier currencies were strong as well while safer ones were on the defensive. Traders wait for US nonfarm payrolls due for release at 12:30 GMT.

As for economic data in Australia, the Australian Industry Group Australian Performance of Services Index rose from 27.1 in April to 31.6 in May. Being below the neutral 50.0 level, though, the index was still showing a decline in the industry. Furthermore, while the indicator rebounded from the record low registered in April, the reading was the second lowest on record. The report commented on how damaging the coronavirus pandemic and the measures to contain it were to the service industry.

Released yesterday by the Australian Bureau of Statistics, the trade balance logged a surplus of A$8.80 billion in April, seasonally adjusted, down from A$10.45 billion posted in March. Nevertheless, it was a better result than a surplus of A$7.50 billion that economists had predicted.

Retail sales dropped by 17.7% in April on a seasonally adjusted basis after rising by 8.5% in March. Market participants were expecting a slightly bigger drop of 17.9%, the same that was demonstrated in the special preliminary estimate released to show the impact on the COVID-19 pandemic.

AUD/USD climbed from 0.6942 to 0.6993 as of 6:29 GMT today. EUR/AUD fell from 1.6327 to 1.6258. AUD/JPY rallied from 75.76 to 76.50.

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