empty
16.04.2024 03:17 PM
AUD/USD: Australian dollar remains under pressure

The absence of significant macroeconomic reports from Australia suggests that the Australian dollar will keep trading in sync with the market, primarily reacting to the news from the United States and the dollar's dynamics.

The first rate cut by the RBA is projected for November, as inflation is expected to show a slight increase in the first quarter. With the expectations for a Fed rate cut pushed to September, the Aussie is likely to remain under pressure for objective reasons until the fall.

One of the main factors affecting domestic inflation remains the labor market. The very low unemployment rate paves the way for high wage growth rates, and improvements are not expected quickly—if unemployment was at 3.7% in February, it is expected to rise to 4.25% by the end of the year. The process of slowing average wage growth is too slow for the RBA to ignore this inflationary factor. Thus, the regulator will not cut rates until it is confident that wage growth has sufficiently slowed.

This image is no longer relevant

Prices for Australia's key export commodities (iron ore, LNG, and coal) have decreased in recent months, putting pressure on the trade balance, despite higher prices for oil and most industrial metals. A rise in copper and aluminum quotes, supporting commodity currencies, is primarily linked to a surge of interest in artificial intelligence and is not related to the Australian economy.

Further uplift in the global industrial cycle and/or additional stimulus in China could help reverse the situation, but at the moment, there is no reason to abandon a bear case scenario.

The net short position on AUD decreased by $572 million over the reporting week to -$6.121 billion. A decline in the volume of short positions allowed the price to stay near the long-term moving average, but overall positioning remains bearish.

This image is no longer relevant

The AUD/USD pair fell in sync with the market, ending its February-March correction. If the price fixes below the support level of 0.6444, the pair is expected to extend losses and head towards the support area of 0.6320/30. In case of a rebound after a week-long decline, the pair will face resistance at 0.6444. A rise above this level seems unlikely.

Kuvat Raharjo,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

May FOMC Meeting: A Preview

We'll learn the results of the Federal Reserve's latest policy meeting on Wednesday. On one hand, it's a routine event with a predetermined outcome. On the other hand, the currency

Irina Manzenko 00:32 2025-05-07 UTC+2

The Euro Holds Its Ground

Trade wars matter more than politics. Friedrich Merz's proposal to revise Germany's fiscal brake rule laid the foundation for EUR/USD's upward trend. Theoretically, his failure to become chancellor should have

Marek Petkovich 00:32 2025-05-07 UTC+2

Australian Dollar Hits New Highs

The Australian dollar updated its five-month high against the USD at the start of the new week. NAB (National Australia Bank) revised several of its forecasts concerning the Australian economy

Kuvat Raharjo 00:32 2025-05-07 UTC+2

The Euro Ends Its Consolidation and Prepares to Rise Again

Inflation in the eurozone remained at 2.2% year-on-year in April, slightly above the expected decline to 2.1%. Meanwhile, core inflation rose from 2.4% to 2.7%, significantly exceeding the forecast

Kuvat Raharjo 19:08 2025-05-06 UTC+2

USD/JPY. Analysis and Forecast

The Japanese yen is attracting buyers following a recent decline, owing to its status as a safe-haven asset in times of uncertainty. The anticipated recovery of the yen is supported

Irina Yanina 18:47 2025-05-06 UTC+2

EUR/USD. Analysis and Forecast

The EUR/USD pair is struggling to establish a clear short-term direction, trading within a multi-day range as markets await decisive news from the upcoming FOMC meeting regarding the interest rate

Irina Yanina 11:05 2025-05-06 UTC+2

USD/CAD. Analysis and Forecast

Today, the USD/CAD pair remains positive within a familiar range, without showing strong buying momentum. The strengthening of the U.S. dollar following a two-day decline is attributed to the positive

Irina Yanina 11:03 2025-05-06 UTC+2

The Market Took a Step Back

The longest winning streak of the S&P 500 in two decades has come to an end. But who's responsible? The Federal Reserve, which plans to keep rates unchanged

Marek Petkovich 10:16 2025-05-06 UTC+2

Markets Anxiously Await the Fed's Monetary Policy Meeting (Potential for Renewed Growth in Bitcoin and #NDX)

Markets remain tense. The U.S. Dollar Index and the cryptocurrency market are stagnating, caught between opposing forces. Investors are tensely awaiting the outcome of the Federal Reserve's monetary policy meeting

Pati Gani 10:02 2025-05-06 UTC+2

GBP/USD Overview – May 6: Trump Goes After the Film Industry

The GBP/USD currency pair traded upward during the first half of Monday and downward during the second half. While the U.S. dollar didn't lose much this time, its brief attempt

Paolo Greco 07:04 2025-05-06 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.