Australian dollar interrupted its two day winning streak.

The Australian Dollar (AUD) has halted its two-day rise against the US Dollar (USD), as traders remain cautious ahead of the announcement of US Nonfarm Payrolls (NFP). This data may provide more information about the extent of the Federal Reserve’s (Fed) projected rate drop this month.

RBA Governor Michele Bullock has suggested that it is too early to consider rate reduction.

The Australian dollar boosted by the favorable Trade Balance figures reported on Thursday. Additionally, Michele Bullock, Governor of the Reserve Bank of Australia (RBA), addressed at “The Anika Foundation” in Sydney on “The Costs of High Inflation,” claiming that it is too early to consider rate cuts. Currently, the board does not anticipate being able to lower rates in the foreseeable future.

US dollar falls further after Fed Dovish Comments.

The US dollar falls more as Fed officials make dovish comments. However, good crucial economic data may have restricted the greenback’s decline. US ISM Services PMI increased to 51.5 in August from 51.4 in July, exceeding market expectations of 51.1.
On Friday, Chicago Fed President Austan Goolsbee stated that the longer-run pattern of the labor market and inflation data justify the Fed lowering interest-rate policy soon, followed by a gradual reduction over the next year. FXStreet’s FedTracker, which measures the tone of Fed members’ speeches on A proprietary AI model scored Goolsbee’s statements as neutral on a dovish-to-hawkish scale of 0 to 10, giving them a score of 3.8.

Daily Market Movers: The Australian Dollar declines ahead of US nonfarm payrolls.

ADP Employment Change reported on Thursday that private-sector employment climbed by 99,000 in August, following a 111,000 increase in July but falling short of the projection of 145,000. Meanwhile, weekly US initial jobless claims increased to 227,000 for the week ending August 30, up from 232,000 the previous week and lower than the initial consensus of 230,000.
Australia’s trade surplus increased to 6,009 million MoM in July, above the predicted 5,150 million and 5,589 million in the previous reading.
Atlanta Federal Reserve President Raphael Bostic announced on Wednesday that the Fed is in an advantageous position, but cautioned against maintaining a restrictive policy stance for too long, according to Reuters. FXStreet’s FedTracker, which uses a bespoke AI algorithm to judge the tone of Fed officials’ talks on a dovish-to-hawkish scale of 0 to 10, gave Bostic’s words a neutral rating of 4.6.
US JOLTS Job openings fell to 7.673 million in July, down from 7.910 million in June, the lowest level since January 2021 and below market estimates of 8.10 million.
Bank of America (BoA) has reduced its China economic growth forecast, decreasing it to 4.8% in 2024 from 5.0% previously. The prediction for 2025 has been lowered to 4.5% growth, while the outlook for 2026 remains at 4.5%.
Australia’s Gross Domestic Product (GDP) increased by 0.2% QoQ in the second quarter, up from 0.1% in the previous quarter but falling short of expectations of 0.3%.

Judo Bank Composite PMI rose to 51.7 in August from 51.4 in July.

The Judo Bank Composite PMI rose to 51.7 in August from 51.4 in July, marking the quickest rise in three months. This expansion was principally driven by an increase in services activity, with the Services PMI rising to 52.5 in August from 52.2 in July, representing the seventh consecutive month of growth in the services sector.
The US ISM Manufacturing PMI increased to 47.2 in August from 46.8 in July, but fell short of market forecasts of 47.5. This is the 21st drop in US factory activity in the last 22 months.