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Forex - AUD/USD weekly outlook: June 13-17

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Forex Pros - Last week saw the Australian dollar slump to a two-week low against its U.S. counterpart on Friday, after the Reserve Bank of Australia left its benchmark interest rate unchanged amid signs of moderating employment growth.

AUD/USD hit 1.0524 on Friday, the pair's lowest since May 26; the pair subsequently consolidated at 1.0534 by close of trade, tumbling 1.7% over the week.

The pair was likely to find short-term support at 1.0508, the low of May 26 and resistance at 1.0662, Thursday's high.

The Australian Statistics Bureau said on Thursday that the number of people employed rose by 7,800 in May, disappointing expectations for an increase of 25,600. The unemployment rate held steady at 4.9%, in line with expectations.

The report said the number of full-time jobs fell by 22,000 in May after dropping 57,200 the previous month, the biggest two-month decline in more than two years.

On Tuesday, the Reserve Bank of Australia held its overnight cash rate at 4.75% in a widely expected decision.

Speaking after the central bank's monthly policy meeting, RBA Governor Glenn Stevens indicated that policymakers were content to hold interest rates steady for now amid signs of a slowdown in the global economy and a loss of momentum locally.

Concerns over a slowdown in China's economic growth also pressured the Aussie after data on Friday showed that China reported a trade surplus of USD13.1 billion in May, significantly below expectations for a surplus of USD19.1 billion, as export growth slowed.

China is Australia's largest trading partner.

Looking ahead to the coming week, U.S. data on retail sales and consumer price inflation will be a focus of attention. Meanwhile, RBA Governor Stevens is to speak at a public engagement.

Ahead of the coming week, Forex Pros has compiled a list of these and other significant events likely to affect the markets.

Monday, June 13

In the U.S., Federal Reserve Bank of Dallas President Richard Fisher is to speak at a public engagement.

Tuesday, June 14

Australia is to publish a report on business confidence, an important indicator of economic health.

Later in the day, the U.S. is to produce official data on producer price inflation, a leading indicator of consumer inflation. The country is also due to publish government data on retail sales, the primary gauge of consumer spending, which accounts for the majority of overall economic activity.

Wednesday, June 15

Australia is to publish a report on consumer sentiment as well as data on a leading index designed to predict the direction of the economy. Meanwhile, RBA Governor Stevens is to speak. Traders scrutinize his public engagements as they are often used to drop subtle clues regarding future monetary policy.

Elsewhere, the U.S. is to release a flurry of data, including reports on consumer price inflation, industrial production and the capacity utilization rate, leading indicators of economic health.

The U.S. is also to publish government data on the balance of domestic and foreign investment as well as official data on crude oil inventories and manufacturing activity in New York state.

Thursday, June 16

Australia is to publish data on new vehicle sales and inflation expectations. In addition, the RBA is to publish its quarterly bulletin, which provides a detailed analysis of current and future economic conditions from the bank's point of view.

The U.S. is to publish its weekly report on initial jobless claims as well as official data on building permits and housing starts, an excellent gauge of future construction activity. The country is also to produce data on its current account and natural gas stockpiles, while the Federal Reserve Bank of Philadelphia is to publish an index of manufacturing activity.

Friday, June 17

The U.S. is to round up the week with a report on an index of leading indicators, which is designed to predict the direction of the economy, while the University of Michigan is to publish preliminary data on consumer sentiment and inflation expectations.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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