AUD: Australian Dollar remains under pressure

At the Forex currency market the Australian Dollar rate continues to be the target of bears’ attention

Forex forecast: MACD indicator is in the positive area for the pair AUD/USD and keeps on declining, giving a pair sell signal with the volumes slightly above average. Stochastic Oscillator falls in the neutral zone, giving a similar signal.

Forex recommendations: in case of breakdown at the level of 1.0600 the pair will go to 1.0585 and 1.0570. If downward breakdown does not take place, the pair will consolidate at the current levels.

It became known yesterday that unemployment rate remained unchanged, at the level of 4.9% in April, and the change in the employment rate in April amounted to -22.1 thousand compared to +37.8 thousand in March. Market did not expect such an unpleasant surprise from the employment sector which, along with investors’ risk aversion in the market, has encouraged ongoing sales of the AUD.

According to the information received today, ABS, Australian Bureau of Statistics has not received authorization for additional funding to assess inflation indicators in the country on a monthly basis instead of existing quarterly basis. Therefore, from all OECD countries only Australia and New Zealand do not release inflationary data on monthly basis. 

Take not of CPI level in Australia that increased by 1.6% on quarterly basis (+3.3% y/y) in QI. Therefore, inflation in the Green Continent has reached five-year highs; natural disasters have triggered the rise in costs for food and other consumption goods for people. In addition, commodity prices at the global markets remain high, because tension in the Middle East does not abate. RBA expects that net CPI will reach 3% against predicted 2.75% by the end of this year.

Exports increased by 9%, to A$25 billion in March; import rose by 1%. It became known earlier that index of import prices increased by 0.9% on quarterly basis in QI. Index of leading indicators rose by 4.7% y/y in March against the rise by 4.8% in February. It is a good result taking into account that the Reserve Bank of Australia has been keeping interest rate unchanged for a long time. Statistics released earlier showed that trade balance in Australia rose to A$1.74 billion in March against the level of -A$0.08 billion in February and Moody's Investors Service agency gave positive assessment to the data; according to observers of the agency, resolution of the authorities to revert the balance of the state budget to the zone of surplus is well-founded and such attitude supports credit rating of the country, which is at Aaa.

Note that the rise in the indicator was caused by the growth of exports of iron ore and coal and also by the reduction of gasoline imports.

 
 

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