Aussie dollar lingering – RBA Tuesdau May 5thÂ
We saw a series of good and bad news late last week affecting risk appetite in the equities market. Firstly we had the talk of serious money to back up the economy from US to Japan and Europe. Although the European meeting ended with positive notes but alas there was no action to follow. Then we had the announcement of test failure of Gilead’s drug on Thursday that brought in series of speculation and removed some of the risk appetite that was stored in the equities market.
During times like this normally the Aussie enjoys the ride from risk on/off sentiments but overall the reaction was somehow muffled as traders were waiting to see what happens with the RBA meeting and their announcement on first Tuesday of May. Over all FX and Shares remains bearish on the Aussie during 2020. Our opinion is mainly due to the effect of government hand outs ( lagging effect predicted) and reduction in the size of the economy on Micro as well as Macro levels.