2024 March, 5, 04:43:32 AM
AUD Consolidates Amid A Flat Equity Market
Daily Digest: Australian Dollar Consolidates Amid Risk-Off Sentiment
Market Movers: Australian Dollar
The Australian Dollar (AUD) is trading flat on Tuesday, consolidating after experiencing losses in the previous session. The risk-off sentiment prevailing amidst a stagnant ASX 200 Index may have contributed to this subdued performance.
Economic Indicators
- Australian Current Account Balance: Rose to 11.8 billion in Q4 2023, higher than expectations of 5.6 billion and the previous 1.3 billion.
- Australian Services PMI: Surged to 53.1 in February, a ten-month high, indicating expansion within the services sector.
- Chinese Services PMI: Contracted to 52.5 in February from 52.7 previously.
Federal Reserve Developments
- The US Dollar Index (DXY) remains stable, showing a sideways movement amid lower US Treasury yields.
- Market participants are closely monitoring key US employment figures due for release this week.
- Fed Chairman Jerome Powell is set to testify before the US Congress, providing insights into the central bank's stance and future policy decisions.
Technical Analysis: AUD/USD
AUD/USD is hovering around 0.6510. Immediate resistance lies at the 21-day EMA (0.6533), followed by the 23.6% Fibonacci retracement level (0.6543) and the 0.6550 level. A break above this resistance zone could lead to a move towards 0.6600. Support is seen at 0.6500, followed by 0.6486 and 0.6450.
Major Currency Performance
| Against USD |
Last 7 Days |
Weekly Change |
| AUD |
-0.54% |
-5.4% |
| Against EUR |
Last 7 Days |
Weekly Change |
| AUD |
-0.57% |
-5.7% |
| Against GBP |
Last 7 Days |
Weekly Change |
| AUD |
-0.57% |
-5.7% |
| Against CAD |
Last 7 Days |
Weekly Change |
| AUD |
0.01% |
0.1% |
| Against JPY |
Last 7 Days |
Weekly Change |
| AUD |
0.71% |
7.1% |
| Against NZD |
Last 7 Days |
Weekly Change |
| AUD |
0.04% |
0.4% |
| Against CHF |
Last 7 Days |
Weekly Change |
| AUD |
0.04% |
0.4% |
Inflation and Foreign Exchange
Inflation measures the rise in the price of goods and services, and is often measured by the Consumer Price Index (CPI). Higher inflation can lead to higher interest rates, which have a positive impact on currency value. Conversely, lower inflation can lead to lower interest rates, which make other currencies more attractive.
Gold and Inflation
While Gold was traditionally considered a safe haven during times of high inflation, it is not always the case. Higher interest rates, a common response to high inflation, can make Gold less attractive. Therefore, lower inflation can be more beneficial for Gold.
