The AUDUSD pair is currently trading within a range as market participants await the US CPI report. Recent US economic data has pressured the USD, leading to a shift in market expectations from one to three potential rate cuts.
The US CPI report is anticipated to influence the USD’s strength. A stronger data release may reduce rate cut expectations, while a weaker report could contribute to further USD weakness ahead of next week’s FOMC meeting.
Australian Dollar And Economic Factors
The Australian Dollar faces pressure from trade tensions and a recent RBA rate cut to 4.10%. However, employment data and a slight increase in the Trimmed-Mean CPI to 2.8% may provide some support.
Technical analysis indicates resistance at 0.6350 for AUDUSD, with sellers likely to enter at this level, while buyers seek a breakout towards 0.65. A minor support level is located at 0.6250, where buyers might step in if the price pulls back.
Looking ahead, upcoming economic indicators include the NYFed Consumer Inflation Expectations, US Job Openings, US CPI, US PPI, Jobless Claims, and the University of Michigan Consumer Sentiment report.
With the AUDUSD pair hovering within a tight band, all eyes remain fixed on the upcoming release of US inflation data. The recent wave of American economic figures has exerted pressure on the US dollar, prompting a notable shift in interest rate outlooks, moving from a single expected rate trim to as many as three. This recalibration has steered sentiment firmly in one direction.
The forthcoming CPI figures carry weight. If numbers exceed expectations, the likelihood of multiple Federal Reserve rate reductions could diminish, offering fresh support to the greenback. On the other hand, if inflation data falls short, the case for easing strengthens, adding further downward momentum. This comes just ahead of next week’s Federal Reserve policy gathering, where clarity on interest rate direction will take further shape.
At the same time, external forces press against the Australian dollar. Trade disputes weigh on sentiment, while the Reserve Bank’s recent rate adjustment to 4.10% has added its own pressure. Despite this, certain indicators offer a counterbalance. Employment data remains a focal point, and the slight uptick in trimmed-mean inflation to 2.8% hints at some resilience. While these factors do not erase the broader concerns, they provide some level of stability.
Key Technical Analysis Levels
From a technical standpoint, the 0.6350 level presents a near-term ceiling. Sellers have consistently emerged around this area, making it a barrier to further upside moves. Should bullish momentum persist, a close above this point could pave the way for an approach towards 0.65. On the downside, support registers at 0.6250, where interest from buyers has appeared on previous pullbacks. If price retreats towards this figure once again, renewed demand could surface.
Looking forward, key American economic updates will steer expectations. Reports on consumer inflation sentiment from the New York Federal Reserve, US job openings data, and updates on producer price growth will all be watched closely. Weekly jobless claims and consumer confidence numbers from the University of Michigan round out the key markers in the days ahead, each carrying implications for policy projections and market positioning.
