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AUD/USD Fundamental Forecast – April 28, 2016

By:
James Hyerczyk
Updated: Apr 27, 2016, 05:29 UTC

The AUD/USD plunged following the first quarterly decline in inflation in more than seven years. The consumer price index fell 0.2 percent in the three

AUD/USD Fundamental Forecast – April 28, 2016

The AUD/USD plunged following the first quarterly decline in inflation in more than seven years. The consumer price index fell 0.2 percent in the three months to March, the first fall since the first quarter of 2008. That brought Australia’s annual inflation rate to 1.3 percent, well below the Reserve Bank’s target of 2 to 3 percent, which increases the chances of a Reserve Bank of Australia interest rate cut.

The Australian Dollar/U.S. Dollar was last trading at 0.7639, down 0.0107 or -1.39%.

On Tuesday, the U.S. Federal Open Market Committee kicked off its two-day meeting and is scheduled to release its statement on monetary policy Wednesday afternoon at 2:00 pm ET. The central bank is widely expected to leave interest rates unchanged, but investors will be eyeing its monetary policy statement for clues on the timing of the next rate hike.

Look for the AUD/USD to fall further if the Fed’s monetary policy statement contains strong language that suggests a possible rate hike in June. If the Fed is dovish then the Aussie may rally, but gains will be limited by the thought of a possible rate hike by the RBA in May.

FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

Today’s economic releases:

Cur. Event Actual Forecast Previous
  USD API Weekly Crude Oil Stock -1.070M 0.800M 3.100M
  USD API Weekly Cushing Crude Oil Stock 1.900M -02.35M
  NZD Trade Balance (MoM) (Mar) 117M 476M 339M
  NZD Trade Balance (MoM) (Mar) -3,380M -3,560M -3,320M
  AUD CPI (QoQ) (Q1) -0.2% 0.3% 0.4%
  AUD CPI (YoY) (Q1) 1.3% 1.8% 1.7%
  AUD Trimmed Mean CPI (QoQ) (Q1) 0.2% 0.5% 0.6%
  EUR GfK German Consumer Climate (May)   9.4 9.4
  GBP GDP (QoQ) (Q1)   0.4% 0.6%
  GBP GDP (YoY) (Q1)   2.0% 2.1%
  USD Goods Trade Balance (Mar)   -62.50B -62.50B
  USD Pending Home Sales (MoM) (Mar)   0.5% 3.5%
  USD Crude Oil Inventories   2.366M 2.080M
  USD FOMC Statement  
  USD Fed Interest Rate Decision   0.50% 0.50%
  NZD Interest Rate Decision   2.25% 2.25%
  NZD RBNZ Rate Statement  
  JPY BoJ Monetary Policy Statement (YoY)  
30-Minute AUD/USD, April 27,2016
30-Minute AUD/USD, April 27,2016

Upcoming Economic Events that you should be monitoring:

Thursday, April 28, 2016

Cur. Event Actual Forecast Previous
  JPY BoJ Outlook Report (YoY)  
  JPY BoJ Press Conference   
  EUR German Unemployment Change (Apr)   4K 0K
  USD GDP (QoQ) (Q1)   0.7% 1.4%

Government Bond Auctions

Date Time       Country           Auction

Apr 27 11:03 Sweden Holds bond auction

Apr 27 11:10 Italy Holds CTZ auction

Apr 27 11:30 Germany Eur 1bn 2.5% Aug 2046 Bund

Apr 27 19:00 US 2-year FRN, 5-year note auctions

Apr 28 11:10 Italy Holds 5yr/10yr bond auctions

Apr 28 19:00 US Holds 7-year note auction

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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