The Australian dollar dropped like all other currencies in the wake of the superb GDP growth report from the US. At 4% annualized vs. 3% expected, the greenback was on a roll.
However, the Australian dollar’s resilience that we’ve seen of late continued very nicely in the second major US event of the day, and the Aussie dollar is back to the range.
The Federal Reserve remained worried about employment and not overly excited about inflation. More importantly, a rate hike in the US is still far off, or in the Fed speak, a “considerable†amount of time down the road. The 6th taper was priced in.
This may all change in September, assuming the current economic continues at the same clip, but for now, this dollar strength is not enough against the Aussie. With a 9 As credit rating at home and a relatively stable Chinese economy, the money continues flowing into Australia and keeps the A$ bid.
So, AUD/USD fell as low as 0.9302, which was the lowest since June 5th, but didn’t stay there for too long. After the Fed, the pair is back to 0.9326, and is at the verge of the previous range, which is basically above the 0.9330 level.
Here is the daily chart with all the levels:
For more, see the AUD/USDÂ prediction.
