ATFXForeign exchange market: Iron ore prices hit a new high in over two years, but the Australian dollar has not been significantly affected...

The Australian dollar is a commodity currency, and its value is affected by the rise and fall of iron ore prices. In the past two trading days, the price of iron ore has continuously risen, with a cumulative increase of3.93%, highest touch1025.5element/Tons, creating2021year8A new high since the beginning of the month. However, yesterday,AUDUSDPlummet0.81%The short-term construction of the roof structure is completed, and it is expected that the downward trend will continue. Why did high iron ore prices fail to effectively boost the value of the Australian dollar? The answer is that the US dollar index is dominantAUDUSDTrend. It is precisely because the US dollar index experienced a sharp rise yesterday that it led toAUDUSDThe reverse decline is significant, and only when the US dollar index continues to move can the positive impact of high priced iron ore on the Australian dollar be reflected. In fact, the impact of iron ore prices on the value of the Australian dollar is not reflected in real-time, but rather dispersed over a very long period of time. Since the recovery of the Australian economy, the export of mineral products has been affected, but the chain of price increases for minerals has been relatively long, spreading to the macro economy and then to the value of the Australian dollar. This point starts fromAUDUSDThe overlay chart with iron ore prices also shows that the correlation between the two is not high in the short cycle, but the long-term trend has resonance.


From a technical perspective,AUDUSDIn the medium to long term bullish trend, yesterday's sharp decline failed to change the upward structure. In the past two months,AUDUSDThere have been three rounds of upward trend and two rounds of downward trend, and the market price is currently operating in the third round of downward trend. The market price is below the blue regression line, but due to the fact that the underlying structure has not yet formed, the upward pulling force of the regression is temporarily unable to play a role. Awesome Oscillator KDThe reading is in the lower middle range, distance20The oversold line still has some distance to go, and it is expected that the short-term decline will continue.MACDThe bar line of the indicator has just crossed the zero axis, and the medium to short term trend has turned bearish. The absolute value of the bar line is small, and the short-term decline cannot yet affect the medium-term bullish trend. Overall, most indicators believe thatAUDUSDThe short-term decline continues, but after finding effective support, it will rise again along the trend.

From a monetary policy perspective, the Reserve Bank of Australia has suspended interest rate hikes for four consecutive periods, and market expectations for the Fed's rate cuts also apply to the Reserve Bank of Australia. From an economic data perspective, Australia10Of the monthCPIThe annual growth rate is4.9%, much lower than the previous value5.6%The problem of high inflation has been significantly alleviated. However, in absolute terms,CPIThe annual growth rate is still relatively high. The reason why market participants expect the Federal Reserve to cut interest rates is because the United StatesCPIThe annual growth rate has decreased to3.1%. Logically speaking, countries with higher inflation rates tend to have central banks more inclined to maintain high interest rates. The inflation rate in Australia is higher than that in the United States, so the timing of the Federal Reserve's interest rate cut should lag behind that of the Federal Reserve. From this perspective,AUDUSDThe medium to long term upward trend will not change.

Risk reminder, disclaimer, special statement:
There are risks in the market, and investment needs to be cautious. The above content only represents the analyst's personal views and does not constitute any operational suggestions. Please do not consider this report as the sole reference. At different times, analysts' perspectives may change, and updates will not be notified separately.

2024-01-03