• Thu. May 30th, 2024

AUD/USD remains on the defensive above the mid-0.6500s, all eyes on RBA, Fed rate decision

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  • AUD/USD loses ground near 0.6560 in Monday’s early Asian session. 
  • The RBA is anticipated to leave its key interest rate unchanged at 4.35% on Tuesday. 
  • The US FOMC is likely to hold its benchmark rate at its March meeting on Wednesday as inflation remains elevated.

The AUD/USD pair trades on a negative note above the mid-0.6500s during the early Asian session on Monday. Markets are likely to trade quietly ahead of the Reserve Bank of Australia (RBA) and the US Federal Open Market Committee (FOMC) interest rate decisions on Tuesday and Wednesday, respectively. The major pair currently trades around 0.6560, down 0.01% on the day.

The RBA is expected to hold its key interest rate at 4.35% for a third consecutive meeting at its March meeting scheduled for Tuesday. Furthermore, investors anticipate the Australian central bank to retain a mild tightening bias and see at least two rate cuts in the final quarter of 2024. The timing of RBA easing may depend on when the US Federal Reserve (Fed) begins cutting rates, which is estimated in the June meeting. However, any surprise dovish remarks from the RBA after the policy meeting might drag the Australian Dollar (AUD) lower against the US Dollar (USD).

On the other hand, the Fed is likely to maintain its monetary policy at its March meeting amid the uptick in inflation in the US. The Fed Chairman Jerome Powell warned in recent weeks about cutting interest rates too early and emphasized a “data-dependent” approach to ensure inflation returns to the 2% target firmly.

On Friday, the preliminary US University of Michigan Consumer Sentiment Index eased to 76.5 in March from 76.9 in February, weaker than the market expectation of 76.9. Additionally, the one-year and five-year inflation expectations were unchanged at 3.0% and 2.9%, respectively.

Looking ahead, the RBA will announce its interest rate decision on Tuesday, while the Fed will announce it on Wednesday. Traders will take cues from these events and find trading opportunities around the AUD/USD pair.

AUD/USD

OVERVIEW
Today last price 0.656
Today Daily Change -0.0001
Today Daily Change % -0.02
Today daily open 0.6561
TRENDS
Daily SMA20 0.6559
Daily SMA50 0.6569
Daily SMA100 0.6586
Daily SMA200 0.6561
LEVELS
Previous Daily High 0.6584
Previous Daily Low 0.6552
Previous Weekly High 0.6639
Previous Weekly Low 0.6552
Previous Monthly High 0.661
Previous Monthly Low 0.6443
Daily Fibonacci 38.2% 0.6564
Daily Fibonacci 61.8% 0.6572
Daily Pivot Point S1 0.6548
Daily Pivot Point S2 0.6534
Daily Pivot Point S3 0.6516
Daily Pivot Point R1 0.658
Daily Pivot Point R2 0.6598
Daily Pivot Point R3 0.6612

 

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