AUD/USD stabilizes near 0.6600 albeit uncertainty ahead of US CPI and Fed’s decision


  • AUD/USD holds ground slightly below 0.6600 while the outlook remains uncertain.
  • The Fed is expected to hold interest rates steady for the seventh straight time.
  • The Australian Dollar will dance to the tunes of the Employment data.

The AUD/USD pair gains ground slightly below the round-level resistance of 0.6600 in Tuesday’s New York session. The Aussie asset finds cushion even though the US Dollar (USD) remains firm amid cautious market mood ahead of the United States (US) Consumer Price Index (CPI) data for May and the Federal Reserve’s (Fed) monetary policy announcement on Wednesday.

The S&P 500 opens on a bearish note amid expectations that the Fed will keep interest rates steady in the range of 5.25%- 5.50%. 10-year US Treasury yields have edged down to 4.44% but hold their strong recovery from 4.27%. The US Dollar Index (DXY) extends its upside to the monthly high near 105.45.

Investors see the Fed holding interest rates at their current levels for the seventh time in a row as the battle against stubborn inflation continues. Fed officials will not consider rate cuts until they are convinced that inflation will sustainably return to the desired rate of 2%.

Investors will pay close attention to the US CPI data for May to determine the current status of inflation. Annual core inflation, which excludes food and energy prices, is estimated to have decelerated to 3.5% from the prior release of 3.6%, with the headline figure rising steadily by 3.4%.

Meanwhile, the Australian Dollar will dance to the tunes of the Employment data for May, which will be published on Thursday. The Australian laborforce is expected to have expanded by 27.5K fresh payrolls. In April, Australian employers hired 38.5K new workers. The Unemployment Rate is estimated to have declined to 4.0% from 4.1% in April. The employment data will influence market speculation for Reserve Bank of Australia (RBA) rate cuts.

Currently, investors expect that the RBA will not reduce interest rates this year. Market expectations for the RBA, keeping interest rates restrictive for the entire year, strengthened after commentary from RBA Governor Michele Bullock indicated that the central bank is prepared to increase interest rates further if inflation does not return to the target range of 1%- 3%.

AUD/USD

Overview
Today last price 0.66
Today Daily Change -0.0010
Today Daily Change % -0.15
Today daily open 0.661
 
Trends
Daily SMA20 0.6646
Daily SMA50 0.6578
Daily SMA100 0.6562
Daily SMA200 0.6541
 
Levels
Previous Daily High 0.6611
Previous Daily Low 0.6576
Previous Weekly High 0.6699
Previous Weekly Low 0.6579
Previous Monthly High 0.6714
Previous Monthly Low 0.6465
Daily Fibonacci 38.2% 0.6598
Daily Fibonacci 61.8% 0.6589
Daily Pivot Point S1 0.6587
Daily Pivot Point S2 0.6564
Daily Pivot Point S3 0.6552
Daily Pivot Point R1 0.6622
Daily Pivot Point R2 0.6634
Daily Pivot Point R3 0.6657

 

 

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