Forex Analytics from LiteForex of 12.11.10: AUD: Australian Dollar rate continues to decline

At the Forex currency market the Australian Dollar rate is going down on Friday, keeping up the developing descending trend.

Forex forecast: MACD indicator is in the negative area for the pair AUD/USD and it goes down, confirming a previous sell signal for the pair. Stochastic
Oscillator is giving a similar signal today, being in the oversold zone.

Forex recommendations: in case of breakdown at the level of 0.9830, the pair will go to 0.9770 and 0.9730.
 

There was no Australian news published today and the currency continues to face pressure from the external background, it was also deprived of the oil prices support. A week earlier the Reserve Bank of Australia decided to raise interest rate to the level of 4.75% per annum against the previous level of 4.5%, which was a surprise to the market. The regulator noted in the comments that country's economy is vulnerable to external influence and has too little spare capacity. The risks of inflation still remain and it will make sense to proceed with policy tightening more actively.
 

The Australian Ministry of Finance has updated budget forecast this week. Thus, GDP in 2011 is expected to be at the level of 3.5% (growth), in 2012 -
3.75% (unchanged). Net debt will amount to 6.4% by 2012. At that, new budget deficit will be higher by 41.5 billion AUD in 2010-2011.

The situation in the country's labor market is complicated. Unemployment rate in Australia increased to 5.4% which became half a year high. Previous
level of the rate amounted to 5.1% and market participants expected to see reduction to 5.0%. In addition, 29.7 thousand jobs were created in October
(forecast +20 thousand). Thus, the increase in the labour share in the country has changed in favour of labour. We shall wait for the authorities'
comments in this regard; however it is already clear that chances for the rate increase in the nearest future are diminishing.

Unemployment rate is expected to be at the level of 4.75% in 2011 and at the level of 4.5% in 2012.

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