Aussie dollar trading above US$0.65
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Daily Currency Update
The Australian dollar is slightly stronger this morning when valued against the Greenback currently trading at 0.6504 at time of writing. The AUD/USD pair extends gains for the third straight day on Friday, although it has trimmed a portion of its intraday gains and holds above the 0.6500 psychological threshold. The pair recently reached a multi-day high before retracing some of its intraday gains. The positive momentum in the pair is influenced mainly by broad-based US dollar weakness. On the data front last week the Australian Bureau of Statistics (ABS) reported a 2.1% annual rise in the consumer price index (CPI) for October, maintaining the lowest rate of inflation since July 2021. “Annual inflation was steady at 2.1% in October,” said Michelle Marquardt (pictured above left), ABS head of prices statistics. Key contributors to the rise included food and non-alcoholic beverages (+3.3%), recreation and culture (+4.3%), and alcohol and tobacco (+6.0%). However, dramatic declines in electricity (-35.6%) and automotive fuel (-11.5%) played a significant role in easing inflation. Looking ahead this week and on Monday we will see the release of the monthly ANZ Job Advertisements and Retail Sales figures. On Wednesday the Australian Bureau of Statistics will release the latest quarterly Gross Domestic Product.Key Movers
The US dollar Index (DXY), which measures the value of the USD against a basket of currencies, trades near 106.10 with mild losses but trimmed most of its daily losses, which saw the index below 106.00. Overall, the US dollar maintains a bullish outlook, supported by strong economic data and a hawkish Federal Reserve (Fed) stance. Despite profit-taking and geopolitical uncertainty, the uptrend remains intact. Going forward, investors will focus on a slew of US employment-linked data and the ISM Manufacturing and Services PMI data for November, which will be released next week. The array of economic data will influence market expectations for the Federal Reserve’s (Fed) monetary policy action in December. According to the CME FedWatch tool, the likelihood for the Fed to cut interest rates by 25 basis points (bps) to 4.25%-4.50% in the December meeting is 66% while the rest supports leaving them unchanged. US stocks closed at record highs on Friday, with the Dow Jones Industrial Average rising 0.4% to close at a record high and the S&P 500 gaining 0.6% to reach a record at the end of a holiday-shortened trading session. Friday's rally, which included a 0.9% jump from the tech-heavy Nasdaq Composite, capped off a winning month for all three major indexes. It also marked the best post-Thanksgiving Friday session for the S&P 500 since 2012. Gold's price advanced late during the North American session on Friday, up by 0.67%, yet it remains set to print monthly losses of over 3%.Expected Ranges
- AUD/USD: 0.6400 - 0.6600 ▲
- AUD/EUR: 0.6050 - 0.6250 ▲
- GBP/AUD: 1.9350 - 1.9550 ▼
- AUD/NZD: 1.0850 - 1.1050 ▲
- AUD/CAD: 0.9000 - 0.9200 ▼