The AUDUSD exchange rate has been rejected by recent resistance as a busy economic calendar awaits for Australia and the United States.
AUDUSD – Daily Chart
AUDUSD has found resistance at the 0.65260 level and now faces an uptrend support line ahead of 0.65. That could open lower levels near 0.6475 If the data supports the dollar.
The first data will be released at 8am HKT on Monday with some Australian inflation and building permits. The higher level data at 8:30am is the latest retail sales with a gain of 0.3% expected.
US data will arrive ahead of Tuesday’s session with ISM manufacturing data at 11pm HKT. That number is expected to come in at 47.5 which would be a gain of a point but still lower than the 50 expansion level.
Wednesday brings GDP growth data from the Australian economy at 8:30am HKT. Commonwealth Bank has issued a warning as the Aussie economy is growing at only half the pace of population growth. Outside of the pandemic, the economy is growing at the slowest pace since the 1991 recession, as workplace output slows.
Things are unlikely to get better soon with the Commonwealth Bank’s head of Australian economics Gareth Aird saying the economy grew by just 1.1% in the year to September. The country’s biggest bank wrote that economic growth would be “well below the rate of population growth” pace of 2.3%, showing that a large influx of foreigners is doing little to grow the economy.
Ahead of the Thursday session, US ISM services PMI will be released with a dip to 55.5 from 56 expected. The services PMI figure is more important to the US economy as 70% of the economy is driven by the services sector.
Late on Friday evening will see the release of US payrolls jobs data. Traders can get an early idea from Thursday’s jobless claims data on how the market is performing.
French bank Societe Generale said profit estimates are contradicting the potential for rapid interest rate cuts.
“Historically, when US interest rates are cut by the extent expected by markets next year, US profits decline by 10%, yet the consensus is for 15% EPS growth next year!” said Andrew Lapthorne, analyst at the bank.
The data this week could see further gains for the dollar after the pair hit resistance.
