AUD/USD support place at 0.77000
British Prime Minister Boris Johnson is ready to offer Australia duty-free access to British food markets. Despite all the warnings that it could affect the agriculture of Great Britain. However, George Eustice, the secretary of the environment, and Michael Gove, the cabinet minister, have privately expressed reservations about the agreement.
This comes after the National Farmers’ Union (NFU) gathered agricultural leaders from all four transferred countries on Tuesday to express their concerns amid reports of a split in the government over whether a broad free trade agreement with Australia should be approved. British farmers are afraid of increasing imports of cheaply produced Australian beef, lamb and sugar, which, as they say, would reduce the price of produced food to a higher standard and at higher costs in Britain.
Amid a series of support measures announced on Tuesday, China’s National Development and Reform Commission (NDRC), the country’s state planner, said Australia should stop the wrong action of interfering in bilateral trade. Hoping that Australia will treat Chinese companies fairly, he sees cooperation in an objective and reasonable way. Australian Finance Minister Steven Kennedy gave optimistic comments on the economic recovery in yesterday’s interview and the fact that the price of iron ore is a key uncertainty for the prospects of the Australian economy.
Today’s economic news is that the Wage Price Index in Australia has risen seasonally adjusted by 0.6 percent compared to the quarter in the first three months of 2021. The Australian Bureau of Statistics announced on Wednesday. That exceeded expectations by 0.5 percent and was unchanged from the previous three months. The optimistic market mood also favored AUD/USD upwards.
Trade sentiment improved after the United States showed readiness to share more of its vaccines with countries in need. “President Joe Biden will send at least another 20 million doses of the COVID-19 vaccine overseas by the end of June, the first time the United States has distributed vaccines approved for domestic use,” Routers reported. Also, similar could be done by China in its global effort to waive the covid vaccine patent.
We will do a brief technical analysis on the daily time frame. The AUD/USD pair is still moving in a large growing channel, testing the bottom line of support and moving averages MA20, EMA20, and MA50. During this year, the AUD/USD pair was in the range of 0.75000-0.80000, and there is a chance to see a larger shift on the chart. A break below the support line pulls us down towards 0.75000 and support in the MA200 and EMA200, and the opposite scenario is a rejection from the support line and a continuation towards the previous high at 0.80000. The MACD indicator is on the bearish side, directing us towards the lower targets on the chart.
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