FX.co ★ Death-X-PK | AUD/USD

AUDUSD 4-H Time Frame Update The cash rate would drop from 3.35% following Novembers move to 2.85% by May if the RBA were to decrease interest rates in November, February, and May, according to experts. Notably, AMP Chief Economist and Head of Investment Strategy Shane Oliver continues to price in a November decrease despite recent statistics indicating a rise in economic growth. Oliver pointed out that throughout the current policy easing cycle, the RBA has only lowered interest rates by 75 basis points and raised them 13 times before turning around. Markets are also anticipating a 50 basis point rate decrease by the Fed in September, with additional cuts perhaps coming in Q4. A shrinking interest rate gap in favor of the Australian dollar is indicated by policy divergence. If participation increases and unemployment unexpectedly declines, upcoming labor market statistics may postpone additional RBA rate reduction. On the other hand, until consumer spending and overall economic activity indicate a more severe slowdown, poor labor market data is unlikely to lead to more aggressive RBA easing. These crucial situations might determine whether the AUD/USD pair stays above $0.66. The AUD/USD could move toward $0.66 due to weak Australian data or dovish RBA rhetoric. The AUD/USD could move toward $0.67 due to hawkish RBA indications or strong Australian labor market data. A decline in consumer confidence could feed rumors of strong Q4 Fed cuts. The US-Aussie interest rate differential would further decrease under a more dovish Fed rate path, which would benefit the Australian dollar. In this case, the AUD/USD exchange rate might rise to $0.67. On the other hand, rising sentiment might reduce wagers on Q4 Fed rate decreases. The AUD/USD exchange rate could rise toward $0.66 if the Fed adopts a less dovish policy path.