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Australia's AAA sovereign rating was affirmed by S&P Global Ratings and the outlook was revised up to 'stable' from 'negative'. The Australian dollar strengthened against most major counterparts on Friday. S&P expects the federal budget balance to return to surplus by the early 2020s.

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'We expect steady government revenue growth supported by the strong labor market and relatively robust commodity prices, to be accompanied by expenditure restraint,' S&P said.

Much attention to Australia has been on the nation's high property prices which have been falling in the past few months. The S&P said that they expect property prices to continue their orderly unwind, and that this slowdown would not weigh heavily on consumer spending and the financial system's asset quality.

MW AUDUSD W 9 22 18

The Aussie rose to more than a 3 week high of 0.7305 against the U.S. dollar (chart above),  it also broke the 2-day high of 0.9422 against the Canadian dollar, with talk of resistance around the 0.95 level.

The key risk reward exchange rate the Aussie-Yen rose to 82.37 the highest since August 9, with 84.00 the next natural level there. With all the Brexit related flow the Aussie remained steady against the euro but recovered to 1.6117 bouncing from a 3-day low of 1.6177. Next key resistance is seen near the 1.59 region.

The aussie however did fall a 3-day low of 1.0884 versus the neighbour's currency, the New Zealand dollar, the Kiwi before closing at 1.0907.

From a sunburnt country....

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