AUD/USD continues to lose ground on Thursday, as the pair trades below the 0.93 level early in the North American session. The pair has surrendered over 100 points this week and is trading at its lowest level since early April. On the release front, Australian Building Approvals was down sharply and US Unemployment Claims met expectations.
Australian Building Approvals tends to show strong fluctuations, making accurate forecasts a tricky task. After a strong gain in May, the key indicator reversed directions in June, posting a decline of 5.5%. This was much lower than the estimate of a 1.0% decline. It was also the indicator's fourth drop in five months, pointing to trouble in the construction sector. Australian Import Prices also slipped, posting a decline of 3.0%. This was the sharpest drop since December 2010.
In the US, Advance GDP soared in Q2, posting a gain of 4.0%. This easily beat the estimate of 3.1%. The boost in economic activity was boosted by strong consumer confidence and business activity in Q2. Meanwhile, ADP Nonfarm Payrolls was unable to keep pace. The key employment indicator dropped to 218 thousand, compared to 284 thousand a month earlier. This was well off the estimate of 234 thousand. If the official Nonfarm Payrolls follows suit with a weak reading, the US dollar could give up its recent gains.
If CB Consumer Confidence is any indication, the US consumer is brimming with optimism about the economy. The key indicator jumped to 90.9 points, crushing the estimate of 85.5 points. This was the indicator's highest level since September 2007. Consumer confidence is closely tracked by analysts since a confident consumer is likely to increase consumption, which is critical for economic growth.
AUD/USD 0.9300 H: 0.9330 L: 0.9280
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