AUD/USD rises to near 0.6620 despite weak Australian Trade Balance data

AUD/USD gains to near 0.6620 even as the Australian Trade Balance data for August came in weaker than expected.
The RBA kept its interest rates steady at 3.6% in the policy meeting this week, as expected.
Weakening US job market has boosted Fed dovish bets.

Sagar Dua FXStreet

The AUD/USD pair trades 0.15% to near 0.6625 during the European trading session on Thursday. The Aussie pair gains despite the Australian Trade Balance data for August coming in weaker than projected.

Earlier in the day, the Australian Bureau of Statistics reported that the Trade Surplus in August came in at 1,825 million on a monthly basis, significantly lower than the estimated 6,500 million and the prior reading of 7,310 million.

Theoretically, soft Trade Balance data weighs on the Australian Dollar (AUD) as the nation’s export market contributes significantly to its overall growth.

Going forward, market expectations for the Reserve Bank of Australia’s (RBA) monetary policy outlook will remain key trigger behind the next move in the Australian Dollar. On Tuesday, the RBA held its Official Cash Rate (OCR) steady at 3.6%, as expected, and warned that inflation is proving to be persistent than what had been anticipated earlier.

“Components of the monthly CPI are a little higher than expected, and inflation is not running away,” RBA Governor Michele Bullock said at a post-meeting press conference.

Meanwhile, the US Dollar (USD) struggles to gain ground as the slowing United States (US) job market has prompted expectations for more interest rate cuts by the Federal Reserve (Fed) this year. The US ADP Employment report showed on Wednesday that the private sector labor force witnessed a reduction of 32K employees in September, while economists anticipated that 50K fresh workers were added in that period.

Another reason behind weakness in the US Dollar is the US government entering a shutdown after the stopgap bill failed to gain a majority in the House of Senate on Tuesday.

Economic Indicator

Trade Balance (MoM)

The trade balance released by the Australian Bureau of Statistics is the difference in the value of its imports and exports of Australian goods. Export data can give an important reflection of Australian growth, while imports provide an indication of domestic demand. Trade Balance gives an early indication of the net export performance. If a steady demand in exchange for Australian exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the AUD.

GBP/USD clings to multi-day peaks below 1.3500

GBP/USD trades with marked gains on Friday, now giving away some gains following an earlier surpass of the key 1.3500 yardstick. Indeed, Cable gathers fresh steam amid the strong offered stance in the Greenback, all after US NFP badly missed expectations in July.

EUR/USD: Post-NFP bounce falters around 1.1580

EUR/USD reverses Thursday’s decline and trades with solid gains in the 1.1560 region, or two-month peaks, on Friday. The pair’s firm performance comes in a context of a sharp correction in the US Dollar as investors continue to assess disheartening US NFP readings.

How Wall Street rigs the game [Video]

In this week’s Live from the Vault, Andrew Maguire is joined by Peter Antico and Sean Stone to discuss the Paradigm of Money - an in-depth expose of financial market corruption, from naked shorting to the two-tier system that protects Wall Street.

XRP Price Forecast: XRP nears critical $1.00 support

Ripple (XRP) remains pressured on Friday, trading around $1.03 at the time of writing. The token appears to hold this current level as support but lacks a catalyst to sustain a knee-jerk rebound toward the next key resistance at $1.10.

Is Gold about to enter its biggest bull run since 2020?

Gold has stormed back into the spotlight and its next move could leave late buyers chasing. On August 5, the yellow metal surged almost 7% – roughly $174 – to close near $4,308 an ounce, posting one of its biggest daily advances in recent history. A weaker U.S dollar, falling Treasury yields, changing Federal Reserve expectations and renewed safe-haven demand all struck at once.

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.