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NZD/USD slides on RBA decision, mixed Chinese dataThe New Zealand dollar is down sharply on Tuesday. In the North American session, NZD/USD is trading at 0.5927, down 0.61%. It has been a roller-coaster ride for the New Zealand currency, which continues to swing wildly. Last week, NZD/USD surged 3.24%, its best weekly performance since October 2022. This week has been all red for the New Zealand dollar, which has fallen 1.19%. Today's Reserve Bank of Australia decision sent the Australian dollar reeling and also dragged down the New Zealand dollar, as there is a strong correlation between the two trans-Tasman currencies. The Australian dollar is down 1.16% against its US counterpart, despite the RBA raising rates by a quarter point to 4.35%. The language in the RBA statement was somewhat dovish, stating that the rate hike was meant to ensure that "inflation would return to target in a reasonable timeframe.” This signalled an easing of the RBA's tightening basis and raised expectations that the RBA may have completed its tightening cycle or is very close to that stage. The RBA statement included the usual rhetoric that future rate decisions would be data-dependent and rate hikes were still on the table, but the markets jumped on the dovish language and ignored the rate increase, which follows four straight pauses. The strong market reaction suggests that the investors believe that the RBA is unlikely to raise rates even though inflation remains well above the 2%-3% target range and inflation expectations have been stubbornly high. The New Zealand dollar also lost ground due to mixed Chinese data. Imports rebounded in October with a gain of 3.0% y/y following a 6.2% decline in September and beating the market consensus of -4.8%. However, exports fell 6.4% after a 6.2% decline in September and missed the market consensus of -3.3%. This marked a sixth successive decline, indicative of continuing weak global demand for Chinese goods. New Zealand releases Inflation Expectations for the fourth quarter on Wednesday. The market consensus stands at 2.60%, after a 2.79% gain in Q3. An unexpected reading could have a sharp impact on the movement of the New Zealand dollar. NZD/USD is testing support at 0.5929. The next support line is 0.5858 There is resistance at 0.5996 and 0.6069
by OANDA
High Stakes: RBA rate decision vs. Melbourne Cup We are about 8 hours away from the latest Reserve Bank of Australia interest rate decision. That decision is due on Tuesday at 2:30 pm (local Aussie time), a couple of hours before the country's biggest horse race, the Melbourne Cup ($8 million in prize money) is set to take place. But perhaps the more exciting match ups will be occurring in the forex market. Currently, the market is thinking there is a 70% chance of a 25-basis points hike because of the RBA governor's rhetoric that the bank would "not hesitate to raise the cash rate further" if inflation was higher than expected (which it was in its last quarterly reading). The 30% chance of no hike is possibly driven by concerns about mortgage stress in the country after the post-COVID 12 cash rate increases. On the flip side of some potential AUD trades, we have expectations for the US Fed and the European Central Bank (ECB) enacting a 25-basis points cut by June next year. Weaker-than-expected NFP figures in the U.S. last Friday bolstered expectations that the Fed was done with its tightening campaign and pulled the AUD/USD up past 0.64900 from 0.64400. This makes me question whether the upside to the AUD/USD is all played out. Moments after the interest rate announcement will be crucial to see which direction the market wants to take. If the RBA does enact a hike today, concerns about mortgage stress in Australia might induce the pair to revisit some of the levels the pair traversed last Friday during its climb just before market close.
by BlackBull_Markets
Aussie soars to 3-month high, RBA expected to hikeThe Australian dollar has edged lower on Monday, after huge gains on Friday. In the North American session, AUD/USD is trading at 0.6499, down 0.21%. On Friday, the Aussie posted spectacular gains, rising 1.22% and hitting its highest level since August 10th. The US dollar retreated against the majors on Friday, suffering sharp losses after a softer-than-expected nonfarm payrolls report. Nonfarm payrolls fell to 150,000 in October, down from a downwardly revised 297,000 in September and shy of the consensus estimate of 170,000. The reading wasn't a massive miss of the forecast, but investors jumped all over the soft reading as expectations jumped that the Fed could be done with tightening. The Fed rate odds of a hike in December have fallen to 10%, compared to 24% just a week ago, according to the CME Fed Watch Tool. We can expect to hear the markets talk more and more about a rate cut sometime in 2024. The RBA meets on Tuesday and we've seen a remarkable swing in the RBA rate odds. Just a few weeks ago, the probability of a pause was close to 100%, but that has changed dramatically. According to the ASX RBA rate tracker, the odds of a hike are now 50/50, making it a live meeting that could see significant volatility from the Australian dollar. RBA policy makers have a tough call to make after holding rates four straight times. Inflation has been falling slowly but the current level of 5.4% is much higher than the 2% target. Inflation expectations remain high and the RBA wants to see these expectations remain anchored; otherwise, the battle with inflation will become even more difficult.
by OANDA
AUDUSD: Thoughts and Analysis pre-RBA Today's focus: AUDUSD Pattern – Range /Distribution? Support – .6287 Resistance – .6520 Hi, and thanks for checking out today's update. Today, we are looking at the AUDUSD on the daily chart. Today, we have run over the AUDUSD as price continues to test resistance after Friday's fantastic rally after US employment data sunk the USD. Technically price looks good. We have run over price action we want to see to show a continuation in the AUDUSD. Two factors are the USD strength and the RBA rate decision. Rates are expected to rise tomorrow, but will this be it, or will the door be left open? The USD momentum change is another key. If this trend continues, we will look for the AUDUSD to contnue its current trend. We do want to see a new higher low to show a solid trend structure. Good trading.
Long
by Eightcap
AUDCHF: Fakeout or Breakout?We can see we've just broken out of my channel top after a strong bullish move, but this isn't the first time and we're hitting strong resistance. Swissie has been weak of late, unlike the Aussie, so I believe this can go either way. I'll be looking at longs around 0.589 if resistance is broken, but we may well fall back first. If we fall back below 0.578 then I'll be waiting for the triple bottom around 0.561 before looking to go long. Obviously this could all be a fakeout and we'll be back in the channel, but I do think it's risky shorting down hear unless it's for a quick scalp as it definitely looks like a good double bottom is already in play. Both of these currencies are gold dependent for different reasons (Aussie exporting it, Swissie holding it), and Aussie is doing well because gold is. I'm expecting a c0ontinuation of gold strength as per my recent idea, so probably expecting this pair could keep flying?
Long
by Finchcliffe
AUDCHF Super Long signal with possible 2000pips The upcoming week appears to be relatively light on economic data, with the highlight being the RBA (Reserve Bank of Australia) rate hike. Anticipations are for another 25 basis points rate hike by the RBA, reflecting ongoing efforts to manage economic conditions. Additionally, it seems that geopolitical tensions in the Israel War are not expected to escalate further, which could impact currency markets. In this scenario, traders may find opportunities in capitalizing on the strength of the Australian dollar (AUD) and the weakness of the Swiss franc (CHF).
Long
by Tradingstrategyguides
1
AUDJPY: Big week for JPY Yen this weekThere's talk of the BoJ lifting the limit on yields to 1.5% from 1% this week, which would be a very strong catalyst for the Yen to start showing some strength. We can see that this pair does not have any direction at the moment, trading in a flag pattern, but I don't see this as either bullish or bearish at the moment. I'm not sure how or when or if to trade this but monitoring, my idea is based on BoJ protecting its currency generally, I am seeing the Aussie getting stronger so think we'll go up before coming back down, let's see...
Short
by Finchcliffe
Inflation not down under!Australia's CPI data, released yesterday, showcased figures hotter than anticipated. While this may not be 'reaction-worthy' news on its own, the scenario in Australia is worth delving into for several reasons. Inflation Trends Initially, let's consider inflation trends. In most western economies, although inflation remains above central bank targets, the trends are on a downward trajectory. However, when juxtaposed against those for the European Union (EU) and the United States (US), Australia's (AU) inflation rates on a month-over-month (MOM) and year-over-year (YOY) basis still stick out from the norm. Moreover, yesterday’s CPI prints surpassed consensus on both the YOY & MOM basis, indicating a notable deviation from expectations. In fact, Australia's YOY CPI is now on its longest streak above inflation expectations, and crucially, inflation expectations have ceased revising downwards. Given the higher inflation levels compared to its peers, consensus estimates, and expectations, inflation remains a significant concern for Australia. Interest Rates In the realm of interest rates, Australia has been a long-standing “pauser,” having maintained its policy rate unchanged since its June meeting. This prolonged pause now further opens the leeway to raise rates, especially given the “watch and see” approach adopted towards burgeoning inflation. Additionally, its interest rates remain low compared to the US, EU, Canada, and even New Zealand. As a result, on the real rates basis, Australia trails far behind, with its policy rate still 1.3% behind its inflation rate, significantly less restrictive compared to other economies that have already moved into positive real rates territory. We posit that the RBA is behind the curve and has room to react, given the considerably long period of pause and still negative real rates. The market seems to echo this sentiment too, as the odds for a hike in the next meeting surged post the CPI news, moving from 21% to 55%! Against multiple currencies, the AUD appears to be threading above the long-term support level, a threshold that has essentially defined AUD low. This strong support is expected to hold, given its tested and respected level across multiple currency crosses since 2020. Policy turning points between the two currencies, as indicated by the turn in the interest rate differential, have generally marked the trend change for the currency, notably for the AUDEUR pair. Given the persisting high inflation in Australia compared to various economies and metrics, should market expectations trend in the right direction, it's plausible the Reserve Bank of Australia (RBA) may react with a rate hike. This action could tilt the rate differential and interest for the AUD, bolstering the currency. To capitalize on this bullish view on the AUD, we can consider a long position on the AUDEUR. We can set up this trade via a long position on the CME Australian Dollar Futures and a short position on the CME Euro FX futures to create a synthetic long AUD/EUR position at the current price level of 0.5951, stop at 0.5865 and take profit at 0.615. Given that one CME Euro FX futures is for 125,000 Euros and one CME Australian Dollar Futures is for 100,000 Australian Dollars, this suggest that we should use two Australian Dollar Futures to one Euro FX Futures to match the contract size, given that 125,000 Euros is roughly equivalent to 210,000 Australian Dollars at the prevailing exchange rate. Each 0.00005 increment in the Australian Dollar Futures is equal to 5 USD and each 0.00005 increment in the Euro FX Futures is equal to 6.25 USD. The charts above were generated using CME’s Real-Time data available on TradingView. Inspirante Trading Solutions is subscribed to both TradingView Premium and CME Real-time Market Data which allows us to identify trading set-ups in real-time and express our market opinions. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com Disclaimer: The contents in this Idea are intended for information purpose only and do not constitute investment recommendation or advice. Nor are they used to promote any specific products or services. They serve as an integral part of a case study to demonstrate fundamental concepts in risk management under given market scenarios. A full version of the disclaimer is available in our profile description. Reference: www.cmegroup.com www.cmegroup.com melbourneinstitute.unimelb.edu.au www.rba.gov.au www.asx.com.au www.cmegroup.com
ECONOMICS:AUINTRLong
by inspirante
2
AUD/USD extends gains, employment report nextThe Australian dollar has extended this week's gains. In the North American session, AUD/USD is trading at 0.6357, up 0.36%. Australia releases inflation on a quarterly basis, which magnifies the significance of each release. We'll get a look at third-quarter inflation on Wednesday, with a market consensus of 1.1% q/q, compared to 0.8% in Q2. Inflation is expected to fall to 5.3% y/y in Q3, down from 6.0% in the second quarter. Inflation eased in the second quarter, courtesy of a drop in fuel and food prices. The core inflation rate excludes energy and food prices but also declined in Q2 to 5.9% y/y, its lowest rate in a year. The drop in inflation is an encouraging sign and the Reserve Bank of Australia is hoping that the downtrend continues in the third quarter. Still, inflation is well above the RBA's target range of 2-3% and it will be a challenge for the central bank to bring inflation back to the target range. The RBA meets next on November 7th after holding rates for four straight months. What can we expect? Just two weeks ago, the rate odds for a quarter-point hike at the November meeting were just 3%, according to the ASX RBA rate tracker. That has ballooned to 21% currently, which means that while a fifth consecutive pause is likely, it is no longer considered a shoo-in. The RBA has been sending out a hawkish message, saying that the battle with inflation is far from over and further rate hikes remain on the table. Earlier today, Governor Bullock said the RBA "will not hesitate" to raise the cash rate over inflation fears. Despite the RBA's jawboning, the markets are leaning towards another pause, and provided that Wednesday's inflation report is not hotter than expected, it should cement a pause at the November meeting. AUD/USD has support at 0.6240 and 0.6184 0.6343 and 0.6399 are the next resistance lines
by fisherkj4
AUDJPY: Is this the start of the reversal?We saw some JPY strength last week and I think we could be starting to see reversal, however my confirmation of this will be below 93 support. Even though BoJ hasn't intervened yet, there was a lot of buying in the week which we saw against the USD, I still expect BoJ intervention soon. Nice pinbar rejection on the 4HR from my resistance block. Looking for a short here on LTF's, but with tight SL and will keep it following any move down.
Short
by Finchcliffe
AUD/USD edges lower, confidence data nextThe Australian dollar lost ground earlier in the day but has pared these losses. In the North American session, AUD/USD is trading at 0.6381, down 0.05%. The markets are braced for a deceleration in consumer and business confidence indicators, which will be released on Tuesday. Westpac consumer confidence change is expected to decline by 0.7% in October, following a 1.5% decline in September. Consumers remain pessimistic about the economic outlook, and the index, which is currently at 79.7, has been below the neutral 100 level since March 2022. The NAB business confidence index is expected to fall to -2 in September, after improving to 2 in August, the highest level since January. The Reserve Bank of Australia left rates unchanged last week and will meet next on November 7th. This provides the central bank time to evaluate key data, including third-quarter inflation later this month. The RBA has paused for four straight times but can't start to think about trimming rates until inflation, which rose to 5.2% in August, is closer to the 2%-3% target range. US nonfarm payrolls soared in September, with a huge increase of 336,000. This crushed the market consensus of 170,000 and the upwardly revised August reading of 227,000. The unemployment rate remained at 3.8%, compared to the market consensus of 3.7%. Wage growth decelerated in September - from 0.3% to 0.2% m/m and from 4.3% to 4.2% y/y. This is another sign that inflation is easing. The blowout nonfarm payrolls led to the Fed futures market increasing the odds of a rate increase before the end of the year, which currently stands at 31%, according to the CME FedWatch tool. The Fed has been signalling that rates will remain "higher for longer" and traders are concerned that the Fed's scenario could play out, especially with the US posting strong releases such as Friday's nonfarm payrolls. AUD/USD is testing support at 0.6372. Below, there is support at 0.6299 There is resistance at 0.6430 and 0.6531
by fisherkj4
Why is AUD/CHF Going Down?The Australian dollar (AUD) has been on a downward trajectory against the Swiss franc (CHF) since the beginning of October 2023. The AUD/CHF exchange rate has fallen from 0.60 to 0.58, representing a decline of over 3%. There are a number of factors that have contributed to this decline. One factor is the ongoing strength of the Swiss franc. The CHF is considered to be a safe-haven currency, and investors tend to flock to it during times of uncertainty. The current global economic climate is uncertain due to a number of factors, including the war in Ukraine, rising inflation, and concerns about a recession. As a result, the CHF has been in high demand, which has pushed its value higher. Another factor that has contributed to the decline in the AUD/CHF exchange rate is the weakening of the Australian dollar. The AUD has been under pressure due to a number of factors, including the slowdown in the Chinese economy, rising interest rates in the United States, and concerns about the outlook for the global economy. As a result, the AUD has fallen against a number of currencies, including the CHF. The image attached to the query shows the AUD/CHF exchange rate over the past year. The chart shows that the exchange rate has been on a downward trajectory since the beginning of October 2023. The decline in the AUD/CHF exchange rate is likely to continue in the near term, as the factors that are driving the decline are expected to remain in place. Here is a more detailed explanation of the factors that are driving the decline in the AUD/CHF exchange rate: Strength of the Swiss franc: The CHF is considered to be a safe-haven currency, and investors tend to flock to it during times of uncertainty. The current global economic climate is uncertain due to a number of factors, including the war in Ukraine, rising inflation, and concerns about a recession. As a result, the CHF has been in high demand, which has pushed its value higher. Weakness of the Australian dollar: The AUD has been under pressure due to a number of factors, including the slowdown in the Chinese economy, rising interest rates in the United States, and concerns about the outlook for the global economy. As a result, the AUD has fallen against a number of currencies, including the CHF. Trade flows: Australia and Switzerland have a relatively small trade relationship. This means that the AUD/CHF exchange rate is not as sensitive to trade flows as some other currency pairs. However, the slowdown in the Chinese economy is likely to have a negative impact on the Australian economy, and this could lead to a further decline in the AUD/CHF exchange rate. Interest rates: The Swiss National Bank (SNB) has maintained a negative interest rate policy for several years. However, the SNB is expected to raise interest rates in the near future. This is likely to make the CHF more attractive to investors, and could lead to a further decline in the AUD/CHF exchange rate. Overall, the decline in the AUD/CHF exchange rate is likely to continue in the near term, as the factors that are driving the decline are expected to remain in place. Investors should closely monitor the global economic climate, the strength of the Swiss franc, and the performance of the Australian economy to assess the outlook for the AUD/CHF exchange rate. Bard may display inaccurate or offensive information that doesn’t represent Google’s views. Bard Privacy Notice
Short
by masterclass618
EURAUD bullish on dovish RBA Bullish EUR/AUD on Dovish RBA Monetary Policy Reunion The Reserve Bank of Australia (RBA) held its latest monetary policy meeting on October 3, 2023, and decided to keep the official cash rate (OCR) at 4.10%. This was widely seen as a dovish move, as markets had been expecting a 25 basis point rate hike. The RBA's decision was likely influenced by a number of factors, including the recent slowdown in the Australian economy, the ongoing war in Ukraine, and the risk of a global recession. In its statement, the RBA noted that "inflation is higher than expected in Australia and globally, and is expected to remain high for some time". However, the RBA also said that "growth in the Australian economy is expected to slow in the coming months, and the unemployment rate is expected to rise". The RBA's dovish stance is likely to be positive for the EUR/AUD currency pair. A lower OCR in Australia is likely to make the Australian dollar less attractive to investors, while a higher OCR in Europe is likely to make the euro more attractive. In addition to the RBA's monetary policy decision, there are a number of other factors that are currently supporting the EUR/AUD currency pair. These include: The ongoing war in Ukraine, which is weighing on the global economy and boosting demand for safe-haven currencies such as the euro. The risk of a global recession, which is also boosting demand for safe-haven currencies. The European Central Bank (ECB) is expected to start raising interest rates in the near future, which would further support the euro. Technical Analysis From a technical perspective, the EUR/AUD currency pair is currently trading above a key trendline. This suggests that the pair is in an uptrend and is likely to continue to move higher in the near future. The next key target for the EUR/AUD currency pair is the 1.70 level. If the pair can break above this level, it could then move towards the 1.75 level. Conclusion The EUR/AUD currency pair is currently in a bullish trend and is likely to continue to move higher in the near future. This is supported by the RBA's dovish monetary policy stance, the ongoing war in Ukraine, the risk of a global recession, and the ECB's hawkish stance. From a technical perspective, the EUR/AUD currency pair is currently trading above a key trendline. The next key target for the pair is the 1.70 level. If the pair can break above this level, it could then move towards the 1.75 level. Trade Idea Buy EUR/AUD above 1.66 with a target of 1.70 and a stop loss below 1.6356. Risk Warning Trading foreign exchange (forex) is a risky activity and can result in substantial losses. Please ensure that you understand the risks involved before trading forex.
Long
by masterclass618
1
BURGER KING (RBA) Possible long entry The share is making a comeback. Showing some strength after long downtrend. I would accumulate slowly waiting upto a clear confirmation from neckline break in the charts. and most importantly a Golden crossover has already formed. Target price is Rs.200 anytime during the year 2024. Note: Trade with caution! Do not trade solely based on my strategies, these are just individual ideas, kindly consult your investment advisor before taking trades.
NSE:RBA
by StockSession
AUD/USD extends losses, CPI loomsThe Australian dollar is in negative territory on Tuesday. In the North American session, AUD/USD is trading at 0.6405, down 0.28%. Australia releases the CPI report on Wednesday. In July, CPI eased to 4.9%, beating expectations and dropping to the lowest inflation rate since February 2022. CPI is expected to rise to 5.2% in August. Inflation remains more than double the 2% target, and the core rate is also high, with the trimmed mean dropping from 6.0% to 5.6% in August. The RBA has raised rates to 4.1%, the highest level since 2012. Have interest rates peaked? That is the thousand-dollar question. The futures markets have priced in a final rate hike before the end of the year at 35%, as investors are betting the Reserve Bank of Australia is likely done with rate tightening. The Australian economy has cooled off as a result of the RBA's tightening, and the slowdown in China could tip the economy into a recession if rates were to move higher. The central bank is understandably more hawkish, as policy makers don't want to close the door on further tightening with inflation still well above the target. The new RBA Governor, Michelle Bullock, has warned that the door remains open to further rate hikes and said that upcoming decisions will be based on key data. The RBA minutes from the September meeting indicated that members considered a rate hike, but in the end, opted to pause rates. In the US, Consumer Board (CB) Consumer Confidence slipped to 103.0 in August, down sharply from a revised July read of 108.7 and shy of the market consensus of 105.5. This marked a 4-month low. Consumers noted concern over rising gasoline prices and high interest rates and the percentage of consumers who expect a recession rose in September, according to the CB. This does not bode well for consumer spending, a key driver of US growth. AUD/USD is putting pressure on support at 0.6380. The next support line is 0.6320 There is resistance at 0.6446 and 0.6506
by OANDA
1
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NSE:BARBEQUELong
by Rachit_Sethia
USD/CAD rises to 22-week high, BoC decision loomsUSD/CAD is trading quietly in Europe at 1.3651, up 0.06%. I expect to see stronger movement in the North American session, with the Bank of Canada making its rate announcement and the US releasing the ISM Services PMI which is expected to show little change. The Bank of Canada is virtually certain to hold rates at today's meeting, with just a 6% probability of a rate hike, according to the TMX Group. That would leave the benchmark cash rate at an even 5.0%. BoC Governor Macklem would certainly like to call it quits on the central bank's aggressive tightening cycle and perhaps he can look for advice from his peers at the Federal Reserve and the Reserve Bank of Australia. Both the US and Australian economies have seen inflation fall significantly, but Jerome Powell at the Fed and Peter Lowe at the RBA have sent the markets a hawkish message that inflation isn't beaten and the door is open for further rate hikes if necessary. The markets have taken a more dovish stance and are already looking ahead to possible rate cuts. Macklem appears to face the same challenge of acknowledging that rate hikes have cooled the economy and curbed inflation while sounding credible about keeping open the option of further rate hikes. Last week's GDP report indicated that the economy contracted by 0.2%, compared to the BoC's forecast of 1.5% growth. The BoC has hiked repeatedly in order to lower inflation but there are concerns that the rate hikes in June and July may have tilted the risk toward a recession. The Federal Reserve is widely expected to pause at the September 20th meeting. The pause could signal that rates have finally peaked, although don't expect any Fed members to publicly state that the rate-tightening cycle is over. Federal Reserve Governor Christopher Waller said on Tuesday that the Fed can afford to “proceed carefully” with rate hikes, given that inflation has been falling, and if the downtrend continues, "we are in pretty good condition". USD/CAD tested resistance at 1.3657 earlier. The next resistance line is 1.3721 1.3573 and 1.3509 are providing support
by OANDA
RBA expected to pause, US nonfarm payrolls rises slightlyThe Australian dollar has started the week with slight gains. In Monday's European session, AUD/USD is trading at 0.6464, up 0.21%. The Reserve Bank of Australia is expected to hold interest rates at 4.10% when it meets on Tuesday and a rate hike would be a huge surprise. The central bank has paused for two straight meetings and the odds of a third pause stand at 86%, according to the ASX RBA rate tracker. The most important factor in RBA rate policy is of course inflation. In July, CPI fell to 4.9% y/y, down from 5.4% y/y and better than the consensus of 5.2% y/y. Inflation is moving in the right direction and has dropped to its lowest level since February 2022. A third straight pause from the RBA will likely raise expectations that the current rate-tightening cycle is done but I don't believe we're at that point just yet. This is Governor Lowe's final meeting and he is expected to keep the door open to further rate hikes. Incoming Governor Bullock stated last week that the RBA "may still need to raise rates again", adding that the Bank will make its rate decisions based on the data. The RBA isn't anywhere near declaring victory over inflation and has projected that inflation will not fall back within the 2%-3% inflation target until late 2025. The week wrapped up with the US employment report for August. The Fed will be pleased as nonfarm payrolls remained below 200,00 for a third straight month, rising from a revised 157,000 to 187,000. Wage growth fell to 0.2% in August, down from 0.4% in July and below the consensus of 0.3%. The data cements a rate hold at the September 20th meeting, barring a huge surprise from the CPI report a week prior to the rate meeting. AUD/USD is testing resistance at 0.6458. Above, there is resistance at 0.6516 There is support at 0.6395 and 0.6337
by OANDA
Australian dollar edges up ahead of inflation reportThe Australian dollar is in positive territory on Tuesday. In the European session, AUD/USD is trading at 0.6437, up 0.12% on the day. China's economic slowdown is bad news for the Australian economy, which counts China as its biggest export market. China's imports have been falling and as a result, commodity prices have dropped, hurting Australia's exports of iron ore and gold to China. China continues to record weak economic numbers and this will likely be reflected in lower GDP releases, although economic growth is above 5%. The Australian dollar is sensitive to China's economic strength and has declined by around 3% in the third quarter. The Reserve Bank of Australia meets on September 5th and is widely expected to hold rates at 4.10% for a second straight month. There are clear signs of the economy cooling, including inflation and wage growth easing and a slight rise in unemployment. The RBA would like to extend the pause in rate hikes, with an eye on lowering rates sometime in 2024. All eyes will be on Australia's July inflation report which will be released on Wednesday. Inflation has been falling, albeit slowly. In June, inflation fell from 5.5% to 5.4% and the consensus estimate for July is 5.2%. If inflation drops to 5.2% or lower, it should cement a RBA pause in September. A higher rate than 5.2% won't necessarily mean a rate hike, but it would likely lower the odds of a pause, which are currently around 90%. In the US, it is a busy Tuesday with consumer confidence and employment releases. The Conference Board Consumer Confidence index has been on the rise and soared to 117.0 in July, up from 110.1 in June. The estimate for August is 116.0 points. JOLTS Job Openings is projected to decelerate for a second straight month in July, from 9.58 million to 9.46 million. AUD/USD tested support at 0.6424 earlier. Below, there is support at 0.6360 There is resistance at 0.6470 and 0.6531
by OANDA