AUD/USD eyes 0.7300 on expectations of dismal US NFP, focus shifts to RBA
- AUD/USD is marching towards 0.7300 on expectations of poor US NFP and hawkish RBA.
- The US economy is expected to display dismal performance in employment generation.
- Investors should brace for a hawkish commentary from the RBA next week.
The AUD/USD pair is advancing firmly towards the round-level resistance of 0.7300 amid positive market sentiment. The aussie bulls have been a star performer on Thursday after scaling the asset comfortably above the critical resistance of 0.7200.
Sickness in the greenback bulls resulted in funds channelization into the risk-sensitive assets as investors dumped the US dollar on poor Automatic Data Processing (ADP) Employment Change numbers. The ADP Employment Change landed at 128k, significantly lower than the consensus of 300k. Poor employment additions renewed concerns of an imbalance in the US labor market, which may worsen the already complex situation for the Federal Reserve (Fed).
Taking into account, the negative cues from the ADP Employment Change, it will be justified to claim that the market participants could find an extreme deviation in the actual and expected figures of the US Nonfarm Payrolls (NFP). The US NFP is already seen lower at 325k, however, any below-expectations figure would insert more pressure on the US dollar index (DXY). The DXY has plunged to near 101.70 after failing to sustain above 102.50.
On the aussie front, investors are awaiting the announcement of the interest rate decision by the Reserve Bank of Australia (RBA). Inflationary pressures in the aussie zone are advancing further and to tame the soaring prices, the RBA is expected to dictate a tight stance along with a hawkish commentary.
Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
