In brief summary of comments from Westpac on the Australian dollar

The domestic outlook surely doesn't argue for further AUD gains

  • Victoria's Covid-19 resurgence prompting a return to lockdown in Melbourne for 6 weeks
  • This will damage both Victoria's economy and other states as interstate tourism falters again and consumer confidence is shaken

Renewed strength in key commodity prices, with iron ore around $106/tonne, and global equities resilient despite the US's coronavirus surge adds to the case for A$ resilience.

  • But the aussie would still be pricey above 0.70, with risk/reward suggesting selling into the 0.70 handle on a multi-week view.