AUDUSD Weekly Outlook

Daily

The Australian dollar put together a winning streak for a change, gaining about 140 points against the US dollar last week. AUD/USD closed the week at 0.9563. This week’s major event is the RBA’s Monetary Policy Minutes. Here is an outlook of the events and an updated technical analysis for AUD/USD.

The Aussie posted big gains late in the week, as Australian employment numbers were much better than expected. The Aussie also got some help as the US dollar was broadly lower against the major currencies.

Updates:

4hrs

• A mild hawkish change? 4 scenarios for the Fed decision - FOMC preview
• The Aussie gaped lower at the wake of the new week, but quickly recovered. It is trading around 0.96. New motor vehicle sales remained flat after dropping last month.
• The RBA released the minutes from its last policy meeting. The RBA continues to leave the door open for further rate cuts, and said that the Aussie could continue to lose ground due to falling exports. Not surprisingly, the Australian dollar lost a cent on the news, and is struggling in the mid-94 range.
• CB Leading Index came in at 0.3%, while the MI Leading Index gained 0.6%. Both indexes improved from the previous reading.
• AUD/USD has crossed above the 0.95 level.
• AUD/USD loses 0.93 on a hawkish FOMC statement.
• The RBA released its quarterly bulletin.
• Chinese Flash Manufacturing PMI dropped for the third straight month, missing the estimate. It was also the second month in a row that the index has been below the 50-point level, which indicates contraction. Less demand in China is bad news for Australia, which is heavily dependent on trade with the Asian giant.
• AUD/USD has dropped to the l0w-92 range, it lowest level since September 2010. The pair has now lost over three cents this week.

1hrly 

1. New Motor Vehicle Sales: Monday, 1:30. This is an important consumer indicator, as an increase in purchases of new cars or trucks is a sure sign of stronger consumer confidence and spending. The indicator has not looked good lately, with no gains to report since the January release. The May reading was the worst in 2013, with a sharp 2013. The markets will be hoping for some improvement in the upcoming release.
2. RBA Monetary Policy Meeting Minutes: Tuesday, 1:30. The RBA held interest rates steady in June, with a rate of 2.75%. Analysts will be carefully combing through the minutes of the June policy meeting, looking for clues as to the central bank’s future monetary policy.
3. CB Leading Index: Wednesday, 00:00. This important consumer index is based on 7 economic indicators. The May release posted a weak gain of just 0.1%, its lowest reading since February. Will the index put on a stronger performance in the upcoming release?
4. MI Leading Index: Wednesday, 00:30. This index is based on 9 economic indicators, but is considered a minor release since most of the data has already been released. The index dropped from 0.6% to 0.2% in the previous reading, and the markets will be hoping for a stronger June reading.
5. RBA Bulletin: Thursday, 1:30. The RBA Bulletin is released each quarter, and provides the RBA’s analysis of current and future economic conditions in Australia. The report is a third-tier indicator, since most of the information contained in the report has already been released. Nevertheless, analysts will review the bulletin carefully, and a report that is considered more hawkish than expected is bullish for the Australian dollar.
6. Chinese Flash Manufacturing PMI: Thursday, 1:45. This key indicator disappointed in the May release, dropping below the 50-point level for the first time this year, to 49.6 points. A reading below 50 indicates contraction. The markets are expecting another weak release, with an estimate of 49.4 points. Chinese key data should be treated as market-movers, as the Asian giant is Australia’s number one trading partner.