AUDUSD fell below 0.6800 as Fed significant rate cut bets faded.
In Monday’s European session, the AUDUSD pair briefly moved marginally above the critical resistance of 0.6800 before retreating. The Australian dollar continues to fall as the US dollar (USD) rises after strong US employment statistics for September prompted traders to unwind Federal Reserve (Fed) significant rate cut bets for the upcoming policy meeting in November.
The positive US NFP for September has reduced the risks of an economic slowdown.
Market participants expect the Fed to reduce interest rates further by 25 basis points. points (bps) to 4.50%-4.75% in November, following the US job report, which showed a substantial increase in payrolls and stronger-than-expected wage growth. Prior to the announcement of US Nonfarm Payrolls (NFP) statistics, financial markets expected the Fed to continue its larger-than-usual interest rate decrease of 50 basis points.
The US Dollar Index (DXY), which measures the value of the US dollar against six major currencies, continues to advance, approaching 102.60.
The US Consumer Price Index (CPI) data for September, which will be reveal on Thursday, will provide further clarity on the Fed’s interest rate decision in November. The core CPI, which excludes volatile food and energy costs, expected to have gradually increased by 3.2%.
AUDUSD is under significant pressure due to negative market sentiment.
Meanwhile, the Australian dollars (AUD) are Middle East tensions have put pressure on the risk-off market mentality. Historically, geopolitical uncertainties have reduced the desirability of risk-sensitive investments. The next move in the AUD will be determined by the Reserve Bank of Australia’s (RBA) minutes from the September policy meeting. The RBA maintained its Official Cash Rate (OCR) at 4.35% and provided no timetable for beginning the rate-cutting cycle.
https://voiceoftraders.com/analysis/us-dollar-remains-stable-with-a-fed-packed-monday-ahead
