AUD/USD Fundamental Analysis February 5, 2015 – Forecast

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Published: Feb 4, 2015, 04:58 GMT+00:00

Analysis and Recommendation: The AUD/USD gained 23 points to trade at 0.7815 gaining steady climbs in the morning session after falling steadily on the

AUD/USD Fundamental Analysis February 5, 2015 – Forecast

Analysis and Recommendation:

The AUD/USD gained 23 points to trade at 0.7815 gaining steady climbs in the morning session after falling steadily on the RBA decision to drop its lending rate by 25bps. The Aussie bounced back above 0.7800, as investors adjusted to the Reserve Bank’s surprise rate cut and as global stocks and oil prices gained on renewed investor optimism, helped by Greece softening its stance towards debt reform.

The Australian dollar has recovered from six-year lows as rising commodity prices and optimism around Greece weigh on the US dollar. The Australian dollar fell as low as 0.7626 overnight, its lowest since May 2009, after the Reserve Bank of Australia cut the cash rate 25 basis points to 2.25 per cent on Tuesday, its lowest ever level. But the currency has staged a recovery to trade around 0.7800 thanks to US dollar weakness. Optimism around a new Greek debt deal, rising oil prices and more disappointing economic data out of the US were weighing on the greenback.

The gains follow a mix of US dollar weakness coupled with investors adjusting their positions helped after the RBA surprised the bulk of economists by lowering rates to 2.25 per cent, from 2.5 per cent. Rates had previously been unchanged since August 2013.

Westpac’s economics and currency team were among only a handful of experts to correctly call Tuesday’s rate cut, and they now see further shorter downside in the Australian dollar.

FxEmpire provides in-depth analysis for each currency and commodity 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.

Today’s economic releases actual vs. forecast:

Cur.	Event	Actual	Forecast	Previous
NZD	Employment Change	1.2%	0.8%	0.8%
NZD	Unemployment Rate	5.7%	5.3%	5.4%
NZD	RBNZ Gov. Wheeler
CNY	HSBC Services PMI	51.8	52.8	53.4

Upcoming Economic Events that you should be monitoring:

Thursday, February 5^th

Cur.	Event	Actual	Forecast	Previous
AUD	HIA New Home Sales			2.2%
AUD	NAB Quarterly Business			6
AUD	Retail Sales (Dec)		0.4%	0.1%
EUR	German Factory Orders		1.5%	-2.4%
GBP	BoE QE Total (Feb)		375B	375B
GBP	Interest Rate Decision		0.50%	0.50%
USD	Initial Jobless Claims		290K	265K
USD	Nonfarm Productivity		0.5%	2.3%
USD	Trade Balance (Dec)		-38.00B	-39.00B
USD	Unit Labor Costs (QoQ)		1.0%	-1.0%
CAD	Trade Balance (Dec)		-1.00B	-0.64B