Market Watch review. 02.09.2020

In today's release, we’ll cover the following topics:

• Record decline in Australian GDP. 
• General strengthening of USD. 
• Comments of the head of the Bank of England. 
• US oil reserves. 

I'll start with the publication of the Australian GDP report. The actual data turned out to be much worse than the previous and forecasted ones, while it is impossible to call them very bad in the existing realities. During the second quarter of this year, Australia's GDP contracted by only 6.3%, while during the same period, the US GDP contracted by more than 30%, in the Eurozone GDP by more than 11%. Therefore, the release of this report put moderate pressure on the AUD.

Let me draw your attention to the AUD/USD currency pair. We are seeing moderate easing at time of publication. So before the opening of the European trading session, the decline did not exceed 45 points, even taking into account the fact that the pair has been at the maximums over the past 20 months. All this once again indicates that investors are in no hurry to sell AUD, despite the unexpectedly weaker data in the Australian GDP report.

No less important for traders was the release of the ISM manufacturing index for the US. The actual data significantly exceeded the previous and forecasted values, thereby supporting the USD, which continues to strengthen practically across the entire spectrum of the market. So the EUR/USD currency pair fell by more than 150 points by the middle of the European session.

Now let's move on to the upcoming events today. At the junction of two trading sessions: European and American, the head of the Bank of England will speak in front of a special committee of the Treasury Department with the topic “The economic impact of the coronavirus outbreak”. Given the importance of this issue for Britain and the world, the risk of a surge in GBP trading activity increases significantly.

Before the opening of the American trading session and as a result of the hearings of the special committee of the Treasury Department, the demand for the pair GBP / USD, under the support level of 1.3335, remained strong enough, keeping sellers from trying to develop a more powerful wave of decline. But a more powerful weakening of the pair should not be ruled out.

I will conclude today's review with the upcoming publication of data on changes in oil and oil products reserves in the United States. Only a further decrease in stocks can keep oil quotes from resuming the downward movement from the current highs. Let me remind you that the American WTI crude is still trading at $ 43 - close to the highs since the beginning of March.

Closely monitor the news background and be prepared for all the surprises of the market.