Aussie Sharply Lower After Dismal Consumer Sentiment Number

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The Aussie traded sharply lower against the U.S. Dollar today after the release of the Westpac Consumer Sentiment Index, which came out printing at -4.6% versus a previous reading of +3.8%. The index showed Australian consumers were less likely to increase purchases, consequently weakening the Australian economy.

The Australian Dollar was off -0.72 percent against the Greenback in Asia midsession. The rate broke through its 200-day moving average for the first time in five months after the release of the consumer sentiment data. Nevertheless, the prospect of higher U.S. rates had a large part in the currency’s decline.

Technical: AUD/USD could target 0.90 soon – Elliott Wave Analysis

With increasingly positive U.S. economic data, the likelihood of the Fed increasing U.S. interest rates has increased from 52 percent at the beginning of the month to 59 percent currently. Initial Jobless Claims — out on Thursday —are expected to show 306K new claims, if the number is significantly lower, it could affect the Fed’s rate decision on the 17th and send the Greenback even higher against the commodity currencies.

Data that will significantly affect the Aussie include Thursday’s release of Australian Employment Change (+15.2K) and the Unemployment Rate (6.3%), as well as MI Inflation expectations. The week will end with significant U.S. economic data including Retail Sales (+0.3%) on Friday which could significantly affect the AUD/USD exchange rate.

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About Author

Jay Hawk of Orbex enjoyed a twelve year professional financial markets career incorporating extensive first hand futures and options experience obtained by trading in the stock, commodity and forex markets on U.S. exchanges. Jay Hawk personally leased seats and traded as a specialist market-maker with a broker/dealer license on major U.S. trading floors. He also ran stock and options broking desks with hundreds of retail and professional accounts, and I actively managed trading portfolios for private clients as large as $30 million both on and off the trading floors. In addition, Jay started a professional options stock exchange brokerage to provide brokerage services on to floor market-makers and upstairs traders located in New York and Chicago. Jay also gave option seminars as both a consultant and educator and helped start the exchange traded currency options market.

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