Australian Dollar saw red on Friday, fundamentals might limit the downside
The post Australian Dollar saw red on Friday, fundamentals might limit the downside appeared on BitcoinEthereumNews.com.
AUD/USD slightly retreats, settling near 0.6575 on Friday. RBA reiterates its hawkish stance, contributing to a buoyant AUD. Investors digest Chinese inflation reported during the European session. The AUD/USD pair witnessed a minor setback at 0.6575 during Friday’s session, a modest descent of 0.30%. That being said, the Reserve Bank of Australia’s (RBA) unwavering hawkish discourse and stronger Chinese inflation figures might limit the downside for the Aussie. Given the complex Australian economic prospect and the RBA’s hawkish inclination due to elevated inflation, markets persistently price just a 25 bps easing in 2024. Daily digest market movers: RBA’s resolute hawkish tone and robust Chinese inflation data might favor the AUD The Reserve Bank of Australia maintained the rates, echoing that “the board is not dismissing any possibility”. Notably, the Bank highlighted the importance of remaining alert toward conceivable inflation risks, implying no hastened policy reversals. On Thursday, RBA Governor Michele Bullock reiterated the reduced requirement for rate cuts, adopting a hawkish tone and asserting that the board “will not hesitate to lift rates if it needs to” to challenge sustained inflation. On the data front, emphasizing Friday’s inflation report, the National Bureau of Statistics announced consumer prices in China rose by 0.5% in July YoY vs. the forecasts of 0.3%. Additional details revealed that the headline CPI soared 0.5% in July, the highest since February, moderating concerns about a profound economic slump in China. In that sense, while good news comes from Australia, the AUD’s downside is limited. AUD/USD technical outlook: Pair faces strong resistance at the SMA convergence around 0.6000 AUD/USD’s price action over the previous week reflects that the bulls are encountering substantial resistance around the 0.6600 level, which coincides with the convergence of the 20,100 and 200-day Simple Moving Averages (SMA). However, support has been persistently holding…
Filed under: News - @ August 10, 2024 7:18 pm