AUD/USD Fundamental Forecast – February 5, 2016

Analysis and Recommendation:

The AUD/USD added 5 points to 0.7171 on hopes of additional stimulus from China and a slight increase in ore prices.  a Chinese official reaffirmed a growth target of 6.5 per cent to 7 per cent this year, reminding everyone that only a few years ago, that number was in the double digits. Observers expect China’s growth to keep slowing and its demand for resources to weaken.

Recent — and continuing — volatility is at front of mind for traders. They’re also well aware that consumers should have extra cash as their petrol bills fall, but they don’t seem to be spending it.

The Australian economy is expected to grow at a modest rate in 2016 with business confidence key to driving the transition from mining to non-mining sectors, according to our Australian Head of Economic Research, James McIntyre. The global economy is likely to be stronger over the next 12 months as well, with capital flows to become increasingly important for Australia.

Meanwhile, downbeat results from some of the world’s biggest oil producers and weakness in oil-dependent economies have worried investors, who are now positioning themselves for a higher chance of a US recession this year following weeks of financial turmoil and uncertainty around global growth.

US payrolls data will be closely watched later this week, with the Labor Department’s report on January hiring and unemployment.

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:

 

Upcoming Economic Events that you should be monitoring:

Friday, February 5, 2016

Government Bond Auctions

Date Time and Country

Feb 04 11:50 France Holds bond auction

Feb 04 17:20 Sweden Details of I/L bond auction on Feb 11

Feb 08 16:20 Italy Details of bond auction

Feb 09 11:00 Netherlands Holds DSL auction

Feb 09 11:00 Austria Holds bond auction

Feb 09 11:30 Germany Holds I/L bond auction

Feb 09 11:30 UK 0.125% 2026 Gilt linker auction

Feb 09 n/a UK Details of Gilt auction on Feb 17

Feb 09 19:00 US Holds 3-year note auction

Feb 10 11:30 Germany Euro 5bn Mar 2018 Schatz

Feb 10 17:20 Sweden Details of bond auction on Feb 17

Feb 10 19:00 US Holds 10-year note auction

Feb 11 N/A Italy Euro 4-5bn 30-yr syndicated bond auction

Feb 11 11:03 Sweden Holds I/L bond auction

Feb 11 11:10 Italy Announces details of bond auction

Feb 11 11:30 UK 3.5% 2045 Gilt auction

Feb 11 19:00 US Holds 30-year bond auction

Feb 11 n/a US Details of 30-yr TIPS auction on Feb 18

Feb 12 11:10 France Details of bond auction on 18 Feb