AUD/USD set to extend its advance towards the 0.75 mark – ING

AUD/USD closed the week at 0.7415. Economists at ING believe that the pair could extend its upside momentum and test the 0.75 level in the coming days.

Good momentum may linger

“We think the aussie could remain supported for the time being, thanks to its low exposure to the Ukraine conflict, rebounding iron ore prices and a very supportive re-pricing of the RBA rate expectations.”

“One risk may stem from a further deterioration in China's Covid situation, with the country reporting the first deaths since January 2021 amid a surge in Omicron cases. Markets are not giving too much weight on this topic so far, and may be relying on the notion that Beijing will deploy more pro-growth tools if necessary.”

“We think that an acceleration to 0.75 in the coming days is all but possible, although the pair may lack enough bullish momentum for a decisive break above that level just yet.”