AUD/USD gives up gains after Powell's words
- The AUD/USD fell below 0.6600 following Powell's presser.
- The Fed held rates steady as expected at 5.50%.
- Chair Powell embraced policy normalization "at some point" in 2024.
In Wednesday's session, the AUD/USD fell towards 0.6560 after initially rising above 0.6600. The Federal Reserve (Fed) didn't change its policy as expected but Jerome Powell considered that cutting in March isn't likely during its presser which made the US Dollar recover.
In addition, Jerome Powell noted that the inflation data from the last six months was welcomed but that the committee need's to see further data in order to be confident. He also added that it seems likely that the bank will achieve that mentioned confidence and that the officials consider appropiate eventually cutting rates. What brought the pair down was that while markets where expecting some timetable for 2024 rate cuts, Powell considered that the bank won't likely be confident enought in March to start the easing cycle.
For the next sessions, incoming data will determine the pace of the pair. On Thiursday, the US will release weekly Jobless Claims and on Friday, January's Nonfarm Payrolls figures.
AUD/USD levels to watch
Indicators on the daily chart indicate that buyers are holding their ground but as long as the fail to conquer the 20-day Simple Moving Average (SMA), the outlook won't be totally bullish for the immediate short term. On the downside, as long as it 100-day SMA, the overall trend will remain positive.
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Author
Patricio Martín
FXStreet
Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.
