AUD/USD sees little action despite uptick in expected CAPEX

• The Aussie dollar is barely moving even though the forward-looking  CAPEX beat estimates.
• CAPEX fell 0.5 percent in the third quarter. That could be keeping AUD gains under check.
• The path of least resistance is to the higher side as Powell’s dovish comments have strengthened the offered tone around the greenback.

The Australian Bureau of Statistics (ABS) reported an uptick in the fourth estimate of private capital expenditure (CAPEX) spending plans for 2018/19 soon before press time. The Aussie dollar, however, is not impressed.

As of writing, the AUD/USD is flat lined just above 0.73. It has barely moved post-CAPEX release.  

The fourth estimate for CAPEX in the 2018/19 financial year came in at AUD 114.1 billion, beating the estimated print of $108.5 billion.  That figure stood at $102 billion in the third quarter.

So far, however, the 11.3 percent rise from the third estimate of $102 billion has failed to put a bid under the Aussie dollar. The lackluster reaction could be due to 0.5 percent quarter-on-quarter drop registered in the third quarter. The markets were expecting Q3 CAPEX to rise 1 percent, following an upwardly revised -0.9 percent reading.

Markets may scale back their growth expectations ahead of Australia’s Q3 GDP release next week, as Q3 CAPEX fell. The Aussie dollar, however, may not suffer losses as the American dollar has come under pressure following Powell’s dovish speech.

AUD/USD Technical Levels