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Forex - AUD/USD weekly outlook: March 7-11

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Forex Pros - The week ending March 4 saw the Australian dollar close slightly lower against its U.S. counterpart after U.S. jobs data for February came in better-than-expected but disappointed investors who hoped for an even stronger report.

AUD/USD hit 1.0074 on Friday, the pair's lowest since February 24; the pair subsequently consolidated at 1.0137 by close of trade, dipping 0.11% over the week.

The pair was likely to find support at 1.0074, Friday's low and resistance at 1.0201, last Tuesday's high and a two-month high.

On Friday, the U.S. Department of Labor said that employers added 192,000 jobs in February, the most since May, surpassing expectations for an increase of 180,000. The unemployment rate unexpectedly dipped to 8.9%, the lowest since April 2009, from 9.0% in January.

The data disappointed some investors who see strong U.S. jobs growth as necessary for the Federal Reserve to end its second round of quantitative easing and raise interest rates.

On Tuesday, the Aussie advanced to a two-month high after official data showed that Australian retail sales rose more-than-expected in January, led higher by supermarkets and grocery stores after floods in the nation's northeast drove up food prices.

But the Aussie erased gains later in the day, after the Reserve Bank of Australia held the overnight cash rate target at 4.75%, saying a stronger currency and an expected slowdown in employment growth would help to control inflation.

RBA Governor Glenn Stevens called monetary policy "mildly restrictive" and appropriate given the economic outlook.

In the week ahead, the U.S. is to release official data on retail sales for February as well as the University of Michigan Consumer Sentiment preliminary reading for March. In addition, Australia is to publish government data on employment.

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

Monday, March 7

The U.S. is to begin the week with official data on consumer credit, which is closely correlated with consumer confidence. Australia is to publish data on the change in the number of jobs advertised, an important indicator of economic health.

Tuesday, March 8

The U.S. is to publish a report on economic optimism while Australia is to publish data on business confidence and consumer sentiment.

Wednesday, March 9

Australia is to publish official data on home loans, a leading indicator of demand in the housing market. Also Wednesday, the U.S. is to publish a government report on crude oil stockpiles.

Thursday, March 10

The U.S. is to publish a key weekly report on initial jobless claims, the nation's earliest employment data. The country is also to publish a report on the trade balance, the difference in value between imported and exported goods and services over the month.

Australia is to release official data on employment change and the country's unemployment rate, a leading indicator of economic health. Later in the day, the Governor of the RBA Glenn Stevens is to deliver a speech in London; his comments will be closely scrutinized for clues to the future possible direction of monetary policy.

Friday, March 11

The U.S. is to round up the week with government data on retail sales, the primary gauge of consumer spending, which accounts for the majority of overall economic activity. The nation is also to publish a report on business inventories, while the University of Michigan is to produce 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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