AUD Trading Outlook
Australian Dollar (AUD) AUD/USD was strong rallying to 1.0390 before easing later in the US session from profit taking given the large rally over the last 2 days. Traders are looking to the next RBA meeting with a strong chance of a rate cut still on the table. Hotter than expected inflation data this week has underpinned the rally higher with some analysts suggesting the RBA will wait rather than risk stoking inflation by cutting rates in November. Looking ahead, Japanese CPI forecast at -0.2% vs. -0.3% previously.
Australian Dollar (AUD) the Aussie was the strongest currency in the market with Q3 inflation ‘hot’ hampering the RBA rate cutting cycle. The Q3 CPI came in at 2.0% y/y much more than the 1.6% forecast. The AUD/USD broke above 1.0300 and grinded higher after the Chinese PMI showed the Chinese manufacturing outlook improving. Looking ahead, no economic data today.
Australian Dollar (AUD) support at 1.0300 was broken we fell down to 1.0250 in the US session with the bears in control. The RBA is expected to cut rates but this will be greatly impacted by the inflation numbers that we see for the Q3 today. The other main risk event is the Chinese PMI which may give an indication of the pace of the Chinese economy. Looking ahead, Q3 Australian CPI forecast at 1.1% vs. 0.5% previously Q/Q and 1.6% vs. 1.1% previously Y/Y.
Australian Dollar (AUD) the major found support at 1.0300 before bouncing with the Euro. The outlook is negative for the Aussie Fundamentally but the FX market works a lot with correlations and if global stock markets rally then the AUD/USD should be dragged higher.
Australian Dollar (AUD) AUD/USD reversed from 1.0400 as stocks and commodities crashed on Friday. The resurgence of the Aussie last week caught traders off guard with the recent RBA rate cuts not yet leading to substantial AUD weakness. Looking ahead, Japanese Trade Balance forecast at -0.75T vs. -0.47T previously.
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