Australian Dollar soft as a cautious market mood benefits the USD
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US Dollar recovers amid conflict in the Middle East. US NFP data last week tempered aggressive easing bets on the Fed. Reserve Bank of Australia’s Meeting Minutes of September policy meeting might stop the bleeding. The AUD/USD pair declined by 0.50% to 0.6765 on Monday, pressured by a stronger US Dollar and concerns over geopolitical tensions in the Middle East. The Australian economy faces an uncertain future amid conflicting economic signals. Despite healthy employment levels and strong consumer spending, inflation remains stubbornly high. The Reserve Bank of Australia (RBA) has adopted a cautious approach. This week’s minutes will be closely followed. Daily digest market movers: Australian Dollar declines, while US Dollar gains AUD declined amid Middle East tensions, pressuring risk-sensitive currencies due to rising oil prices. USD strengthened with the DXY near 102.00, boosted by strong upcoming US Nonfarm Payrolls data and cooling easing bets on the Fed. The likelihood of a 50-basis-point reduction in November or December has diminished to zero, while there is only a 90% chance of a 25-basis-point cut next month being factored in. Even with robust economic data, the market continues to expect a total easing of 125 basis points over the next year. Fed speakers and Consumer Price Index (CPI) data from the US will guide the pair’s trajectory this week. AUD/USD technical outlook: Pair extends losses, 20-day SMA gone The AUD/USD extends its losses, and indicators are weak with the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) deep in negative terrain. In addition, the loss of the 20-day SMA has worsened the outlook for the pair. Supports line up at 0.6750, 0.6730 and 0.6700, while resistances are seen at 0.6800, 0.6815 and 0.6850. RBA FAQs The Reserve Bank of Australia (RBA) sets interest rates and manages monetary policy for…
Filed under: News - @ October 7, 2024 10:27 pm