AUD/USD Fundamental Forecast – May 3, 2016

The AUD/USD is up 9 points in the morning session to trade at 0.7611 ahead of tomorrow’s RBA rate decision which no one is sure what to expect from Glenn Stevens the odds are a hold in rates and policy but the possibility of a rate decrease looms stronger. Weak Chinese data limited the gains of the Aussie.

China’s official factory gauge, the manufacturing purchasing managers index, stood at 50.1 in April, the nation’s statistics agency said Sunday. That is the second consecutive month the indicator has moved above 50, which indicates improving conditions. The non-manufacturing PMI, which signals conditions at services and construction firms, slid slightly to 53.5 last month after a big jump in March. (Bloomberg)

Westpac senior market strategist Imre Spiezer says the currency is primarily lower, despite firmer commodity prices, because of investor caution ahead of the Reserve Bank’s interest rate decision on Tuesday. “(The Australian dollar) should continue to test the 76 US cent support area ahead of tomorrow’s key RBA meeting,” he added.

The greenback plunged the most last week and again this morning after economic reports trailed forecasts, damping the outlook for growth as Federal Reserve policymakers await evidence needed to justify more interest-rate increases. The US currency has eroded more than half its 9 per cent surge last year, with one measure of dollar momentum approaching a level that indicates to some analysts that it is oversold and set to reverse direction.

The dollar’s dive has hurt investors in international stocks, boosted the price of dollar-denominated commodities and higher-yielding assets in emerging markets, and complicated the task of central banks around the world that need weaker currencies to boost their economies.

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.

Sunday’s economic releases:

Today’s economic releases:

 

Upcoming Economic Events that you should be monitoring:

Tuesday, May 3, 2016

Government Bond Auctions

Date Time       Country           Auction

Mar 02 13:00 Norway Details of bond auction on Mar 04

May 04 11:05 Norway Holds bond auction

May 04 11:30 Germany Eur 4bn Apr 2021 Bobl

May 04 11:50 France Holds bond auction

May 04 17:20 Sweden Details of bond auction on May 11

May 05 10:30 Spain Holds bond auction

May 05 11:00 Austria Holds bond auction