AUD/USD eased back to about 0.6990 on Monday after touching 0.7011 in Asia, while remaining above Friday’s close as markets awaited Australia’s CPI and the Federal Reserve’s rate decision. Risk appetite improved after a pause in hostilities between the US and Iran drove Oil lower and lifted global stock and bond markets. WTI was near $83.70 a barrel, down more than 7%, which tempered inflation concerns and slightly reduced expectations of an immediate Fed hike, offering some support to risk-sensitive currencies including the Australian Dollar.
Upcoming Economic Events
Focus turns to Reserve Bank of Australia Governor Michele Bullock’s speech on Tuesday, alongside the US ADP Employment Change four-week average after it previously fell to 16.5K. Australia’s June CPI follows on Wednesday, after headline CPI fell 0.7% MoM and printed 4.0% annually; Trimmed Mean CPI last rose 0.4% MoM and 3.6% YoY. The Fed then decides after its July 28–29 meeting, having held the 3.50%–3.75% range since early in the year, with US PCE inflation due later, plus BoE on Thursday and BoJ on Friday.
Technical Analysis
Technically, AUD/USD was near 0.6988, bracketed by the 100-period SMA at 0.6969 and the 20-period SMA at 0.6990, with RSI around 49; resistance sits at 0.6990, 0.6995, 0.7002 and 0.7006, while support is seen at 0.6984 and 0.6969.
