AUD/USD rises a han- full of pips on FOMC Minutes


  • AUD/USD has risen on the FOMC Minutes.
  • AUD/USD is currently trading at 0.6884 between a range of 0.6871 and 0.6896.

AUD/USD did not deliver the market impact hoped for, repeating what might have been expected following the Fed's previous meeting and lacking the hawkish impetus for dollar bulls to run with the price of the DXy holding onto the 98 handle by the skin of its teeth. 

Key notes from the minutes:

  • Patient approach appropriate for some time even if global conditions improved.
  • Many Fed officials saw inflation to as likely transitory.
  • Fed discussed pros and cons of shortening bond portfolio maturity
  • Generally agreed a patient approach to interest-rate policy changes was warranted.
  • A few Fed policymakers said that monetary policy might need to be tightened if economy evolves as expected.
  • Many Fed policymakers said holding shorter duration maturities could help future maturity extension programs.
  • A number of Fed policymakers said a portfolio of more capacity for a maturity extension program was more desirable than a proportional portfolio with maturities similar to those of outstanding treasuries.
  • Many Fed policymakers said recent dip in PCE inflation likely to be transitory.
  • Discussed options for reaching the long-term portfolio composition, considered accelerated versus gradual approaches.
  • Several of Fed worried by risk of low inflation expectations.
  • Some say low inflation could on anchor expectations.
  • Inflation pressures remain muted.
  • Few note there still may be slack in the economy.
  • Some say downside risks to growth decreased.
  • Most say downside risks to growth remain.

The focus will now switch back to the U.S. calendar with Markit Manufacturing and Services PMIs, New Homes Sales data and Durable Goods all in play. Elsewhere, the downbeat expectations for the Aussie economy should continue to weigh on the currency ahead of the RBA in June and any further escalation of trade wars will also hinder the prospects of bulls digging their way out of a hole below the 0.69 handle. 

AUD/USD levels

Analysts at Commerzbank noted that AUD/USD nearly reached the 78.6% Fibonacci retracement at 0.6857 and reversed just ahead of here:

"Immediate downside pressure is maintained while capped by the 6 week downtrend at .6928, and a close below the .6857 Fibo will target the .6738 December 2019 low. However we note the 13 counts on the 240 minute chart and we suspect that the market will attempt to recover from here. Above the downtrend would allow for recovery to the 55 day ma at .7058.Further up resistance can be spotted at the .7207 February high. Where are we wrong? A rise above the .7207 late February high would target the 55 week moving average at .7220 and the December 2018 high at .7394."

 

 

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.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD's range play continues ahead of Eurozone Consumer Confidence

EUR/USD remains directionless despite the drop in the US treasury yields. An above-forecast Eurozone Consumer Confidence will likely push the pair higher to the trendline falling from June highs. 

EUR/USD News

GBP/USD sits at 2-month tops ahead of key Brexit talks

Fresh optimism surrounding the Brexit deal propels GBP/USD to a two-month high. Brexit talks between the EU's chief negotiator Michel Barnier and UK Brexit Secretary Stephen Barclay will be the key.

GBP/USD News

USD/JPY: Bears eyeing break below 107.45

USD/JPY trades modestly flat, with the bias leaning to the downside, as we wind down into the close for the week following a data-heavy number of sessions which have left more questions unanswered and the outlook murky. 

USD/JPY News

Gold holds on to recovery gains amid trade/political pessimism

In addition to bouncing off multi-month-old rising trend-line, Gold gains support form recently downbeat trade/political headlines while taking the bids to $1,500 during Friday’s Asian session.

Gold News

Markets unmoved by Fed cut and pause

The Federal Reserve’s latest twist in monetary policy, reducing the fed funds for a second time in two months and then pausing for instructions has left markets without a clear direction on interest rates. Equites ended mixed.

Read more

Forex MAJORS

Cryptocurrencies

Signatures