AUD/USD forecast and technical analysis ► preview of the key events that will move the Australian Dollar (Aussie) during the upcoming week. Here is some general information. Scroll down for the latest AUD/USD outlook
The A$ is a “risk” currency. It tends to rise when stocks and commodities move up and when the global mood improves. It tends to drop when the situation worsens: geopolitical risks increase and the outlook for global demand slumps.
The Aussie’s technical behavior is usually impressive. This implies respecting lines of support and resistance, trend lines, etc. AUD/USD has become more popular for techies in recent years, even after the financial crisis which saw the end of the famous “carry trade.”
Australia exports hard commodities such as copper and iron. We often find a positive correlation between the price of iron ore and the Aussie $. The commodity boom kept Australia out of recession for over 25 years. The land down under enjoyed the resources boom with China leading the demand. While the mining boom has probably peaked regarding growth, the sector still churns out quite a lot, as China has a soft landing.
AUD/USD Recent Moves
The Reserve Bank of Australia clarified it will not change interest rates anytime soon, but the team led by Phillip Lowe would like a lower exchange rate. AUD/USD struggles to conquer the 0.80 level. The economy is doing quite well, with jobs aplenty.
Risks could arise from the Chinese economy: Australia’s No. 1 trading partner could see a slowdown after the Party Congress in October 2017. Leading into this event, China shows no signs of a slowdown, thus making it hard for the RBA to send the currency lower.