AUDUSD pair is trading in a small trading range around 0.6480.
The AUDUSD pair is trading in a small trading range around 0.6480 as the European day begins on Thursday. Market players appear to prefer to stay put ahead of Federal Reserve (Fed) Chairman Jerome Powell’s speech on Friday.
In the United States, business activity grew slowly in August.
In the United States, business activity grew slowly in August. Nonetheless, the preliminary S&P Global Composite PMI fell to 50.4, down from 52.0 before and falling short of market forecasts of 52.0. This is the greatest drop since November 2022. The S&P Global Manufacturing PMI decreased to 47 from 49 the previous month, while the Services PMI fell to 51 from 52.4 the previous month.
Meanwhile, yearly new home sales in the United States were 714K, much above predictions of 705,000.
In response to the data, the US Dollar fell versus its peers, boosting the AUDUSD pair. US Treasury rates have fallen from multi-year highs and are now hovering around 4.20%. The market has priced in a more aggressive Federal Reserve policy for the remainder of the year. According to the CME Fed Watch Tool, the market is pricing in 88% that the Federal Reserve (Fed) will pause interest rates in September and boost rates further in November. Market participants, on the other hand, willThe Jackson Hole Symposium on Thursday will provide clues regarding the interest rate outlook.
Across the pond, the AUDUSD S&P Global Composite PMI dipped to 47.1 on Wednesday, down from 48.2 in July. Meanwhile, the Manufacturing PMI fell to 49.4 from 49.6 predicted and in the previous month, while the Service PMI fell to 46.7 from 47.9 expected and in the previous month.
Furthermore, the People’s Bank of China (PBoC) reduced its one-year Loan Prime Rate (LPR) by a lower margin than expected, to 3.45% from 3.55%. This, in turn, puts some pressure on the Australian dollar.
AUDUSD investors are looking forward to the Federal Reserve (Fed) Chairman Jerome Powell’s speech at the Jackson Hole Symposium.
Investors will be watching reports about China’s economic troubles because they may have an influence on the Australian dollar, which is a proxy for China’s economic prospects. In the absence of economic data from Australia, market participants will focus on the US weekly Jobless Claims and Durable Goods Orders, which are due on Thursday.
In addition, the Jackson Hole Symposium will be widely observed in advance of Federal Reserve Chairman Jerome Powell’s speech on Friday. The events will be crucial in influencing the direction of the AUDUSD pair.
