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Currency Market Analysis

Apr 03, 2020 | Currency Market Analysis

Global Themes

Aussie supported as crude jumps more than 20% on deal hopes

• Oil jumps; Dow boosted
• AUD supported
• Non-farm payrolls key

Oil hopes boost Dow

Global equities and oil prices jumped higher overnight on reports that Russia and Saudi Arabia had agreed to a deal to end their dispute that’s been partly responsible for oil’s fall from US$60 to $20 per barrel.

US President Donald Trump said the deal could see Russia and Saudi Arabia cut production by between 10 million and 15 million barrels per day.

The two countries have seen tensions rise after Russia refused to cut production in line with an OPEC agreement last month.

OPEC, the Organization of Petroleum Exporting Countries, looked to cut production to boost falling prices.

Aussie supported

The AUD was supported by the oil news in an environment that saw the US dollar strongly higher.

The AUDUSD was steady.

The US dollar index climbed 0.7% as markets continued to favour the safe haven currency.

The USD’s strength saw the euro and Japanese yen both weaker.

The AUDEUR was up 0.9% while the AUDJPY gained 0.6%.

US labour woe

Tonight’s focus will be in the critical US non-farm employment report.

Last night, US weekly unemployment claims rose by 6.6 million --- the largest result ever.

The weakness in the US labour market is likely to only partly be seen in tonight’s release.

The market expects the non-farm employment number to fall by 100k.

The release is due at 12.30am AEDT.



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