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AUD/USD Unable to Sustain Gains, Trades Flatly

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The Australian Dollar to US Dollar (AUD/USD) exchange rate briefly soared during the middle of last week, but any ‘Aussie’ gains were eventually reversed as commodities slumped and risk-sentiment plummeted.

Australian Dollar (AUD) Trade Light as Australia Observes Anzac Day

AUD/USD scarcely moved during Monday’s session, trending near 0.7725 with the pair unable to find solid footing. This comes after the pair’s heavy fluctuations last week, where it reached a low of 0.7635 before soaring to an 11-month-high of 0.7825.

Ultimately AUD/USD began last week near 0.7720 and opened this week at 0.7710, showing little change.

The ‘Aussie’ has been largely uninspired going into the new week, with no key data being released for Australia since last Thursday’s NAB business confidence – which scored 4 after the previous quarter’s 5.

Australian markets were also closed during Monday’s session as the nation observed Anzac Day, leaving the AUD/USD exchange rate to be influenced by its rival the US Dollar and general risk-sentiment.

The biggest negative influence on risk over the past week has been the fluctuating prices in global commodity trade. Taking most headlines was the OPEC meeting that failed to agree to an oil production freeze. While oil prices briefly rallied due to an oil worker strike hitting production, oil prices began tumbling late in the week, causing the ‘Aussie’ to slide and the ‘Greenback’ to recover its losses.

Unfortunately for the Australian Dollar, its commodity woes don’t end there as iron ore prices slid over the weekend. The Australian reports that the fall in prices was ironically caused by worries that iron ore prices would drop following previous rallies.

Poor Data, Federal Reserve Concerns Hurt US Dollar (USD)

The ‘Greenback’ sustained considerable losses across the board last week and largely recovered against the ‘Aussie’ in response to negative Australian sentiment.

US sentiment remains low in the new week as AUD/USD has seen no decisive movement despite Anzac Day keeping Australian trade quiet.

Last week’s final key data release from the US region was April’s preliminary Manufacturing PMI, which printed at a disappointing 50.8 – its lowest score since 2009.

With the new Federal Open Market Committee (FOMC) decision right around the corner, the report; which included details on lack of new business growth, falling hiring numbers and stagnating production caused investors to fear that the Fed’s next rate hikes may be pushed back even further.

Australian Dollar to US Dollar Exchange Rate Forecast: Slew of US News to Busy AUD/USD

AUD/USD is likely to move more considerably as markets open for Tuesday’s session and Australian trading resumes after Monday’s public holiday.

Not only that, but investors will have a huge batch of US data to look forward to. Released early Tuesday morning was the US March new home sales report, which printed at a considerable contraction of -1.5% despite being tipped to merely slow from 2.0% to 1.6% – and could lead to the ‘Aussie’ gaining on the ‘Greenback’ today.

Following this later on Tuesday night, March’s preliminary durable goods orders report releases. The highly anticipated data is forecast to come in at 1.9% in March, escaping February’s large contraction of -3.0%. The print is closely followed by the remainder of preliminary US PMI scores.

Investors may not move hugely on the US Dollar, however, as they await Thursday’s key Federal Open Market Committee (FOMC) rate decision.

Australian data, on the other hand, remains quiet until Wednesday’s session where the vitally important Q1 Consumer Price Index (CPI) report is due to be released. The score is currently projected to hold steady growth of 1.7%.

At the time of writing, the Australian Dollar to US Dollar (AUD/USD) exchange rate trended in the region of 0.7725, while the US Dollar to Australian Dollar (USD/AUD) exchange rate traded at around 1.2945.