- AUD / USD still pressed below 0.7300, rumors of a RBA rate hike growing louder.
- The US dollar breaks a two-day downtrend amid firmer Treasury yields and cautious sentiment in the market.
- The AUD / USD draws attention to the Fed speeches, US inflation and concern in the Chinese real estate sector.
The pair AUD/USD it moves sideways as bears and bulls struggle to dominate the pair’s wreck action on Friday. After reaching an intraday high at 0.7291, the pair returns all its initial gains and remains practically unchanged on the day in the region of 0.7275.
It seems that the market remains in “sell the allies” mode, with limited torque below the 0.7300 level, which will likely keep the AUD on the defensive for days to come.
Along with this, market participants are once again optimistic on the news from the Reserve Bank of Australia (RBA) on the rate hike. Nevertheless, RBA policy makers have been constantly warning investors that the long-awaited rate hike will not be announced anytime soon..
On November 16, RBA Governor Philip Lowe said that “the economy and inflation would have to turn out very different from our baseline scenario for the Board to consider an increase in interest rates next year.” Furthermore, he went on to say: “It will likely take time to meet the condition we have set for an increase in the cash rate and the Board is prepared to be patient. “
The investors They also take note of the real estate concern in China, which weighs on the Australian dollar. On Thursday, the S&P Rating agency statement said that “despite recent bond coupon payments, a default remains ‘highly probable’ for Evergrande Group in China,” meanwhile, another rating agency Moody’s also iterated its Concern for Chinese real estate developers, adding, “liquidity stress will continue amid tight credit conditions and lower sales.”
Also, the positive news for the Australian dollar that came out on Thursday was that Victoria was about to ease the COVID-19 lockdown, providing a much-needed boost to the economy in the fourth quarter.
Looking ahead, except for Fed speeches during the American session today, there is no major data or events providing incentives to AUD / USD investors. However, the focus will remain on the RBA rate hike and US inflation expectations.
AUD / USD technical levels
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