AUD/USD defends 0.6800 as RBA’s Lowe appears optimistic, US NFP eyed
|- AUD/USD bounces off intraday low to reverse the pullback from 2.5-month high.
- RBA’s Lowe praises domestic spending, conveys monetary policy lags.
- Sluggish markets restrict immediate moves ahead of US employment report for November.
- Dovish bias for the Fed keeps the Aussie bulls hopeful.
AUD/USD struggles to keep the 0.6800 round figure on the table despite the latest rebound from the intraday low as traders remain cautious ahead of the US employment data for November during early Friday.
The Aussie pair’s latest recovery could be linked to comments from Reserve Bank of Australia (RBA) Governor Philip Lowe. The policymaker recently hesitated in conveying the Aussie central bank’s bearish bias while saying that the board discussed the consequences and costs of not raising rates. “Higher interest rates affect the economy with a lag,” mentioned RBA Governor Lowe.
Additionally, hopes of more stimulus from China and a sustained reduction in the Covid numbers also keep the AUD/USD bulls hopeful
On the other hand, downbeat comments from International Monetary Fund (IMF) Managing Director Kristalina Georgieva seemed to have challenged the AUD/USD bulls. IMF’s Georgieva said that recession risks are rising for many countries, and the outlook for global growth is exceptionally uncertain and dominated by risks. On the same line could be the fears surrounding the slowdown in the Initial Public Offering (IPO) markets.
Even so, downbeat US data and bearish comments from the majority of the Fed policymakers, including Chairman Jerome Powell advocated for easy rate hikes, which in turn favor the AUD/USD bulls.
That said, the S&P 500 Futures drop 0.30% intraday to 4,070 whereas the US 10-year Treasury yields printed a corrective bounce off the 10-week low to 3.54% by the press time.
Looking forward, risk catalysts may entertain AUD/USD traders but the pre-NFP mood may restrict immediate moves of the pair. It should be observed, however, that the downbeat projections of the US job numbers suggest further advances by the Aussie pair. Forecasts suggest that the headlines Nonfarm Payrolls (NFP) is likely to ease with a 200K print versus 261K prior while the Unemployment Rate could remain unchanged at 3.7%.
Technical analysis
A clear break of the previous key resistance line from September 13, now support near 0.6765, keeps AUD/USD bulls towards September’s peak of 0.6916.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.