The Australian dollar started the week softer against the US dollar, hovering around 0.7000 as markets positioned for the Reserve Bank of Australia decision after firm US data. Risk appetite ebbed as US tech shares slipped following Apple earnings, weighing on Asian equities, even as headlines pointed to a possible easing in US-Iran tensions. In the US, the ISM Manufacturing PMI rose to 55.5 in October from 54.5, above the 54.6 forecast, while its inflation gauge eased but stayed in expansion. That backdrop saw money markets cut implied odds of a 25-basis-point Fed hike to 72% from 80% a week earlier, based on the CME FedWatch Tool, and the US Dollar Index fell 0.17% to 101.78 as Treasury yields declined.
US Economic Data and Market Sentiment
Oil’s drop added to the disinflation narrative, with WTI down 6.50% to $96.25 a barrel. Attention turns to JOLTS and Factory Orders, expected to improve to 1.2% in September from 0.1% in August.
Australian Market Focus and AUD/USD Technical Levels
In Australia, the RBA is priced to lift rates by 25 basis points to 4.85%, according to LSEG data. On charts, AUD/USD traded near 0.6996, below the 0.7063 simple moving average cluster; RSI (14) sat at 46, with resistance at 0.7063, 0.7117 and 0.7198, while support was flagged at 0.6922 and then 0.6897–0.6833.
