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  • AUD/USD fell to a fresh two-week low below 0.6800 on Monday.
  • US Dollar Index stays in the positive territory above 97.00.
  • RBA will release the minutes of its June meeting on Tuesday.

The AUD/USD pair closed the previous week in the negative territory after climbing to a fresh multi-month high of 0.7063 on Wednesday. The risk-off market environment at the start of the new week caused the pair to remain under pressure and dragged it to a two-week low of 0.6776.

Nevertheless, AUD/USD staged a technical rebound in the absence of significant fundamental drivers and was last seen losing 0.5% on the day at 0.6830.

Focus shifts to RBA meeting minutes

Earlier in the day, the data from China showed that Retail Sales declined more than expected on a yearly basis in May and hurt the China-proxy AUD. On the other hand, the Federal Reserve Bank of New York’s Empire State Manufacturing Index improved to -0.2 from -48.5 and beat analysts’ estimate of -27.5 by a wide margin. Nevertheless, the US Dollar Index largely ignored this data and continues to stay in the positive territory near 97.20.

On Tuesday, the Reserve Bank of Australia (RBA) will release the minutes of its June meeting.

Assessing the RBA’s monetary policy outlook, “should the recovery be slow and fitful with persistently high unemployment, as we are expecting, the RBA is likely to focus more on the AUD when it rises above 0.70,” ANZ analysts said. “If it then makes a sustained move above 0.75 it is likely to draw policy consideration unless there is a commensurate improvement in global growth, and by extension currency fundamentals.”

Technical levels to watch for

 

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