AUD/USD – Lower as US Inflation Numbers Meet Expectations

The Australian dollar has posted losses on Tuesday, as the pair trades in the low-0.93 range early in the North American session. On the release front, the RBA released the minutes of its last policy meeting, and New Motor Vehicle Sales posted a modest gain of 0.3%. In the US, Building Permits softened in May but CPI releases beat their estimates.

The news out of the US was mixed on Tuesday. Building Permits dropped to 0.99M, well below the estimate of 1.07M. On the inflation front, CPI moved up modestly, posting a gain of 0.3%. This was the strongest gain we’ve seen since January 2013. CPI followed suit, climbing to an eleven-month high. The index rose to 0.4%, beating the estimate of 0.2%.

The markets are keeping a close eye on the US Federal Reserve, which issues a policy statement on Wednesday, with the markets expecting another $10 billion trim to QE, which would reduce the asset purchase program to $35 billion/month. Fed chair Janet Yellen is not expected to provide any time guidelines about a rate hike, so traders shouldn’t expect a repeat of the fireworks we saw with the British pound, which soared following comments about a possible rate hike by BOE Governor Mark Carney.

 

AUD/USD for Tuesday, June 17, 2014

AUD/USD June 17 at 13:20 GMT

AUD/USD 0.9331 H: 0.9395 L: 0.9330

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.9000 0.9119 0.9229 0.9361 0.9446 0.9617

 

  • AUD/USD has lost ground on Tuesday.
  • 0.9229 is providing support.
  • 0.9361 has reverted to a resistance role as the Aussie trades at lower levels. 0.9446 is stronger.

Further levels in both directions:

  • Below: 0.9229, 0.9119, 0.9000 and 0.8923
  • Above: 0.9361, 0.9446, 0.9617 and 0.9757

 

OANDA’s Open Positions Ratio

AUD/USD ratio is almost unchanged on Tuesday. This is not consistent with the movement of the pair, as the Australian dollar has posted losses. The pair has a majority of short positions, indicative of a trader bias towards the US dollar continuing to post gains.

AUD/USD has lost ground on Tuesday. The pair is under pressure early in the North American session.

 

AUD/USD Fundamentals

  • 1:30 RBA Monetary Policy Meeting Minutes.
  • 1:30 Australian New Motor Vehicle Sales. Actual 0.3%.
  • 12:30 US Building Permits. Estimate 1.07M. Actual 0.99M.
  • 12:30 US Core CPI. Estimate 0.2%. Actual 0.3%.
  • 13:00 US CPI. Estimate 0.2%. Actual 0.4%.
  • 13:15 US Housing Starts. Estimate 1.04M.

*Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.