AUD/USD – Australian Dollar Unchanged, RBA Minutes Ahead

The Australian dollar is unchanged on Monday, as AUD/USD trades at the 0.76 level in the North American session. In economic news, it’s a quiet start to the week. In the US, there are two minor indicators on the schedule, the NAHB Housing Market Index and TIC Long-Term Purchases. Today’s highlight is the RBA minutes from the July policy meeting.

There were no surprises from US inflation numbers on Friday. CPI and Core CPI both posted small gains of 0.2% in June, matching their estimates. These figures showed no change from the previous month, as consumer inflation remains stuck at low levels. Positive manufacturing inflation data on Thursday (Core PPI and PPI both beat their estimates) had raised hopes for stronger CPI numbers as well, but this did not occur. There was much better news on the consumer spending front, as Retail Sales climbed 0.7% and Core Retail Sales gained 0.6%, as both key indicators beat their estimates. This points to stronger consumer spending, a key factor in economic growth. The UoM Consumer Sentiment report dipped below the 90-point level for the first time in three months and was short of expectations. The Federal Reserve is unlikely to raise rates before September at the earliest, unless there is some strong improvement in economic data, particularly inflation and wage growth, which remain at low levels.

The Australian employment market continues to improve. Employment Change gained 7.9 thousand, but this fell short of the forecast of 10.1 thousand. The unemployment rate edged up to 5.8%, matching the estimate. There was positive news on the consumer spending front, as New Motor Vehicle Sales recorded a strong gain of 3.1%, reversing directions after two straight declines. Still, the Australian consumer continues to remain skeptical about the economy, according to the most recent consumer confidence report. Westpac Consumer Confidence slipped 3.0% and fell to 99.1 points (a reading below the 100-level indicates pessimism).

AUD/USD Fundamentals

Monday (July 18)

  • 10:00 US NAHB Housing Markets. Estimate 60 points
  • 10:30 Australian CB Leading Index
  • 16:00 US TIC Long-Term Purchases. Estimate 31.6B
  • 21:30 RBA Monetary Policy Minutes

Upcoming Key Releases

Tuesday (July 19)

  • 8:30 US Building Permits. Estimate 1.15M

*Key releases are highlighted in bold

*All release times are EDT

AUD/USD for Monday, July 18, 2016

AUD/USD July 18 at 8:20 EDT

Open: 0.7589 High: 0.7606 Low: 0.7575 Close: 0.7591

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.7251 0.7339 0.7472 0.7612 0.7739 0.7835
  • AUD/USD has shown limited movement in the Asian and European sessions
  • 0.7472 is providing strong support
  • 0.7612 is a weak resistance line and could see action in the North American session
  • Current range: 0.7472 to 0.7612

Further levels in both directions:

  • Below: 0.7472, 0.7339 and 0.7251
  • Above: 0.7612, 0.7739, 0.7835 and 0.7938

OANDA’s Open Positions Ratio

AUD/USD ratio is almost unchanged on Monday, consistent with the lack of movement from AUD/USD. Short positions have a small majority (47%)indicative of slight trader bias towards AUD/USD breaking out and moving downwards.

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

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental and macroeconomic analysis, Kenny Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in major online financial publications including, Seeking Alpha and FXStreet. Kenny has been a MarketPulse contributor since 2012.