|

AUD/USD pauses RBA-led rally below 0.6700 as Australia Q1 GDP disappoints, China trade data eyed

  • AUD/USD retreats from three-week high on downbeat Aussie economic growth figures.
  • Australia Q1 GDP rose 0.2%  QoQ versus 0.3% expected, 0.5% prior.
  • RBA’s hawkish surprise, Governor Lowe’s hints of further rate hikes keep Aussie pair buyers hopeful.
  • China trade numbers, risk catalysts eyed for clear directions.

AUD/USD reverses from the highest levels in three weeks after Australia’s first quarter (Q1) Gross Domestic Product (GDP) print a downbeat outcome early Wednesday. In doing so, the Aussie pair trims the Reserve Bank of Australia’s (RBA) led gains to 0.6675 by staying mildly bid, despite the latest fall, amid a sluggish session.

That said, Aussie Q1 GDP rose 0.2% QoQ compared to 0.5% previous readings and 0.3% market forecasts. On the same line, the yearly GDP came in as 2.3% versus the analysts’ estimation of 2.4% YoY and 2.7% previous readings.

Also read: Aussie Gross Domestic Product (Q1): Miss by 0.1% QoQ and YoY, AUD/USD in 15 pip rangesteady

RBA Governor Philip Lowe signaled further rate hikes from the Aussie central bank and propelled the five-day uptrend of the Aussie pair. That said, the policymaker said, “Some further tightening of monetary policy may be required, depending on how economy and inflation evolve.” It should be known that the RBA surprised markets for the second time in a row by announcing a 25 basis points (bps) rate hike on Tuesday.

Also read: RBA’s Lowe: Too early to declare victory in the battle against inflation

While the Aussie GDP fails to tame the RBA-inspired optimism for the AUD/USD buyers, the softer US Dollar adds strength to the pair’s upside momentum.

US Dollar Index (DXY) reverses the previous day’s corrective bounce while taking offers around 104.00, down 0.10% on a day by the press time. In doing so, the greenback’s gauge versus six major currencies suffers from downbeat market bets on the Fed’s next move. That said, the interest rate futures show a nearly 15% probability of a June rate hike. The reason could be linked to downbeat United States activity data released on Monday, as well as the previously dovish comments from the Federal Reserve (Fed) Officials ahead of the pre-Fed blackout.

Additionally favoring the AUD/USD bulls could be the cautious optimism in the markets, as portrayed by the mildly bid US stock futures and sluggish Treasury bond yields.

Having witnessed the initial market reaction to the Aussie Q1 GDP, AUD/USD pair traders should wait for China trade numbers for April for clear directions. However, the bulls are likely to keep the reins amid the latest RBA versus Fed divergence.

Technical analysis

Although, an upside break of the previous support line stretched from early March, around 0.6620 by the press time, joins successful trading beyond the 50-DMA level surrounding 0.6665 to favor the AUD/USD bulls, the 200-DMA hurdle of near the 0.6700 threshold caps the Aussie pair’s run-up.

Additional important levels

Overview
Today last price0.668
Today Daily Change0.0008
Today Daily Change %0.12%
Today daily open0.6672
 
Trends
Daily SMA200.6613
Daily SMA500.6662
Daily SMA1000.6748
Daily SMA2000.6692
 
Levels
Previous Daily High0.6685
Previous Daily Low0.661
Previous Weekly High0.6639
Previous Weekly Low0.6458
Previous Monthly High0.6818
Previous Monthly Low0.6458
Daily Fibonacci 38.2%0.6656
Daily Fibonacci 61.8%0.6639
Daily Pivot Point S10.6626
Daily Pivot Point S20.658
Daily Pivot Point S30.655
Daily Pivot Point R10.6702
Daily Pivot Point R20.6731
Daily Pivot Point R30.6777

Author

Anil Panchal

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

More from Anil Panchal
Share:

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

By subscribing you agree to our Terms and conditions.

Editor's Picks

EUR/USD moves sideways below 1.1800 on Christmas Eve

EUR/USD struggles to find direction and trades in a narrow channel below 1.1800 after posting gains for two consecutive days. Bond and stock markets in the US will open at the usual time and close early on Christmas Eve, allowing the trading action to remain subdued. 

GBP/USD keeps range around 1.3500 amid quiet markets

GBP/USD keeps its range trade intact at around 1.3500 on Wednesday. The Pound Sterling holds the upper hand over the US Dollar amid pre-Christmas light trading as traders move to the sidelines heading into the holiday season. 

Gold retreats from record highs, trades below $4,500

Gold retreats after setting a new record-high above $4,520 earlier in the day and trades in a tight range below $4,500 as trading volumes thin out ahead of the Christmas break. The US Dollar selling bias remains unabated on the back of dovish Fed expectations, which continues to act as a tailwind for the bullion amid persistent geopolitical risks.

Bitcoin slips below $87,000 as ETF outflows intensify, whale participation declines

Bitcoin price continues to trade around $86,770 on Wednesday, after failing to break above the $90,000 resistance. US-listed spot ETFs record an outflow of $188.64 million on Tuesday, marking the fourth consecutive day of withdrawals.

Economic outlook 2026-2027 in advanced countries: Solidity test

After a year marked by global economic resilience and ending on a note of optimism, 2026 looks promising and could be a year of solid economic performance. In our baseline scenario, we expect most of the supportive factors at work in 2025 to continue to play a role in 2026.

Avalanche struggles near $12 as Grayscale files updated form for ETF

Avalanche trades close to $12 by press time on Wednesday, extending the nearly 2% drop from the previous day. Grayscale filed an updated form to convert its Avalanche-focused Trust into an ETF with the US Securities and Exchange Commission.