AUD/USD Forecast and News
AUD/USD edges higher toward 0.6700, tracking Kiwi's RBNZ-led rally
AUD/USD is edging higher toward 0.6700 in Asian trading on Wednesday, picking up fresh bids in tandem with the NZD/USD pair. The Kiwi rallies on the hawkish RBNZ hold decision. Renewed US Dollar weakness also supports the pair ahead of the Fed Minutes.
Latest Australian Dollar News
AUD/USD Technical Overview
The AUD/USD pair bottomed at 0.6645, now an immediate support level. The daily chart shows the bearish potential remains limited, although the pair keeps losing upward momentum. AUD/USD keeps developing above all its moving averages, with the 20 Simple Moving Average (SMA) heading north above directionless 100 and 200 SMAs. In the meantime, technical indicators turned marginally lower within positive levels, lacking strength enough to confirm an upcoming leg lower.
The AUD/USD pair is neutral-to-bearish in the near term. The 4-hour chart shows a mildly bearish 20 SMA contains advances at around 0.6680, while the longer moving averages maintain their bullish slopes far below the current level. Finally, technical indicators seesaw around their midlines without clear directional strength.
Support levels: 0.6645 0.6600 0.6570
Resistance levels: 0.6680 0.6715 0.6770
Fundamental Overview
The AUD/USD pair trades in the 0.6660 price zone ahead of the Asian opening, little changed from its daily opening. The pair eased early on Tuesday, weighed down by the poor performance of global indexes while barely affected by local news.
Australia published May Westpac Consumer Confidence, which improved to -0.3% from -2.4% in April. Additionally, the Reserve Bank of Australia (RBA) released the Minutes of its May monetary policy meeting, which maintained the overall hawkish stance adopted in the previous meeting. Policymakers considered raising interest rates but decided keeping the Official Cash Rate (OCR) was the better choice. Furthermore, the Broad agreed it's difficult to either rule in or rule out future changes in the cash rate, while risks around the forecasts were judged to be “balanced.” Finally, the document showed policymakers will try to avoid “excessive fine tunning” by looking at a near-term variation in inflation.
Australia will not release relevant macroeconomic data on Wednesday, although news from neighbouring New Zealand may affect the Aussie. The Reserve Bank of New Zealand is set to announce its decision on monetary policy after leaving the OCR unchanged at 5.50% for five consecutive meetings.
SPECIAL WEEKLY FORECAST
Interested in weekly AUD/USD forecasts? Our experts make weekly updates forecasting the next possible moves of the Australian Dollar-US Dollar pair. Here you can find the most recent forecast by our market experts:
AUD/USD: Interim top confirmed, 0.7000 at risk Premium
The AUD/USD pair kept falling in the last few days, reaching a fresh multi-week low of 0.7263 on Friday, to close the trading week a handful of pips above it.
AUD/USD Big Picture
AUD/USD Bullish Themes
AUD/USD Bearish Themes
Latest AUD Analysis
Editors' picks
EUR/USD flattens out near 1.0850 as data looms
EUR/USD stuck closely to familiar levels on a sedate Tuesday market session. Talking points from Fed officials dominated headlines, but provided little new information for investors to digest, keeping risk appetite suppressed and stapling bids close to opening prices.
GBP/USD remains confined above 1.2700 ahead of UK CPI, FOMC Minutes
The GBP/USD pair remains confined around 1.2710 during the early Asian session on Wednesday. Financial markets await fresh impetus, with the release of the UK Consumer Price Index and FOMC Minutes due on Wednesday.
USD/JPY continues winning spell on Fed’s hawkish interest rate outlook
USD/JPY exhibits strength above 156.00 as the Fed maintains a hawkish tone on the interest rate outlook. Fed Bostic prefers to wait with current interest rates to be confident over the progress in disinflation. Japan’s officials remain worried over weak Yen-induced inflation.
Gold price clings to mild losses ahead of FOMC Minutes
Gold price trades on a negative note on Wednesday after retreating from a record high on Monday. Members of the Federal Reserve warned that the US central bank needed much more convincing that inflation was easing before it could begin cutting interest rates, emphasizing the Fed is likely to keep rates higher for longer.
Oil eases further after string of technical rejections
Oil tests the support of its 2024 rally again on Tuesday. Markets disregard current events in the Middle East as there is no risk for output in the region. The US Dollar Index is looking for direction, caught in a tight range at the beginning of the week.
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AUD/USD YEARLY FORECAST
How could AUD/USD move this year? Our experts make an AUD/USD update forecasting the possible moves of the Aussie-US Dollar pair during the whole year. Don't miss our 2024 AUD/USD forecast!
AUD/USD FORECAST 2024
The Australian Dollar (AUD) started 2023 on a high note, though slumped closer to its post-pandemic low against the USD during the latter part of the year. The currency clawed back some of its steep declines during the final two months of 2023, and the outlook seems sunnier in the wake of the prevalent bearish sentiment surrounding the Greenback. Read more details about the forecast.
MOST INFLUENTIAL POLITICAL EVENTS IN 2024 FOR AUD/USD
Will the Fed will achieve a soft landing? The current market pricing for a more aggressive policy easing by the central bank next year might have already set the stage for a disappointment and favours the USD bulls. This should allow the USD to resume the prior uptrend witnessed since July 2023 and keep a lid on a runaway rally for the AUD/USD pair.
The upcoming US Presidential election could also play a key role in influencing the USD price dynamics and driving the aussie.
About AUD/USD
AUD/USD, The 'Aussie'
The AUD/USD pair, also called the “Aussie”, tells the trader how many US dollars (the quote currency) are needed to purchase one Australian dollar (the base currency). This currency pair is also known as the "Aussie". Together with the New Zealand Dollar and the Canadian Dollar, the AUD is a commodity currency, that is a currency whose country's exports are largely comprised of raw materials (precious metals, oil, agriculture, etc.).
The interest rates set by the Reserve Bank of Australia (RBA) have been among the highest of industrialized countries and the relatively high liquidity of the AUD has made it an attractive tool for carry traders looking for a currency with the highest yields. These factors made the AUD very popular among currency traders.
AUD/USD CORRELATIONS
Australia is a big exporter to China and its economy and currency reflect any change in the situation in that country. The prevailing view is that the Australian Dollar offers diversification benefits in a portfolio containing the major world currencies because of its greater exposure to Asian economies.
This correlation with the Shanghai stock exchange is to be added to the correlation it has with gold. The pair AUD/USD often rises and falls along with the price of gold. In the financial world, gold is viewed as a safe haven against inflation and it is one of the most traded commodities.
ORGANIZATIONS, PEOPLE AND ECONOMIC DATA THAT INFLUENCE AUD/USD
The AUD/USD news can be seriously affected by the decisions taken by these organizations and people:
- Reserve Bank of Australia (RBA) that issues statements and decides on the interest rates of the country. Its president is Michele Bullock.
- Australian Government and its Department of Finance that implement policies that affect the economy of the country.
- The US Government: events as administration statements, new laws and regulations or fiscal policy can increase or decrease the value of the US Dollar and the currencies traded against it, in this case, the Australian Dollar.
- Fed, the Federal Reserve of the United States whose president is Jerome Powell. The Fed controls the monetary policy, through active duties such as managing interest rates, setting the reserve requirement, and acting as a lender of last resort to the banking sector during times of bank insolvency or financial crisis.
In terms of economic data, as for most currencies, the AUDUSD traders have to keep an eye on:
- GDP (Gross Domestic Product), the total market value of all final goods and services produced in a country. It is a gross measure of market activity because it indicates the pace at which a country's economy is growing or decreasing. Generally speaking, a high reading or a better than expected number is seen as positive for the AUD, while a low reading is negative.
- Inflation measured by key indicators as the CPI (Core Price Index) and the PPI (Production Price Index), which reflect changes in purchasing trends.
- Current Trade Balance, a balance between exports and imports of total goods and services. A positive value shows trade surplus, while a negative value shows trade deficit. If a steady demand in exchange for AUD exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the AUD.
Michele Bullock
Michele Bullock is an Australian economist who is currently governor of the Reserve Bank of Australia. She commenced as governor on 18 September 2023, and is the first woman to hold the role. She is Chair of the Reserve Bank Board, Payments System Board and Council of Financial Regulators. Prior to her current role, Ms Bullock was the Deputy Governor of the Reserve Bank of Australia.
Michele Bullock RBA's Profile and Wikipedia
Jerome Powell
Jerome Powell took office as chairman of the Board of Governors of the Federal Reserve System in February 2018, for a four-year term ending in February 2022. His term as a member of the Board of Governors will expire January 31, 2028. Born in Washington D.C., he received a bachelor’s degree in politics from Princeton University in 1975 and earned a law degree from Georgetown University in 1979. Powell served as an assistant secretary and as undersecretary of the Treasury under President George H.W. Bush. He also worked as a lawyer and investment banker in New York City. From 1997 through 2005, Powell was a partner at The Carlyle Group.
Jerome Powell Fed's Profile and Wikipedia
RBA NEWS & ANALYSIS
FED NEWS & ANALYSIS
ASSETS THAT INFLUENCE AUD/USD THE MOST
- Currencies: NZD and JPY (New Zealand and Japan are important regional partners of Australia). Other important group of influent pairs includes: EUR/USD, GBP/USD, USD/JPY, USD/CHF, NZD/USD and USD/CAD.
- Commodities: The most important is Gold, as already explained above, but also Iron Ore and Natural Gas.
- Bonds: GACGB10 (Australian Government Bonds Generic Yield 10 Year), GNZGB10 (New Zealand Government Bond 10 Year) and T-NOTE 10Y (10 year US Treasury note).
- Indices: S&P/ASX 200 (stocks of the Australian Securities Exchange), S&P/TSX Global Gold Index (includes producers of gold and related products at the Toronto Stock Exchange).