AUDUSD Analysis 06.03.2019

The Australian dollar fell during the Asian session to its lowest level since January 4 against the US dollar after Governor of the Reserve Bank of Australia Philippe Lowy, in addition to the economic developments and data that followed on the Australian economy and on the eve of developments and economic data expected Wednesday by the US economy The world's largest economy.

At 02:47 am GMT, the AUDUSD fell 0.44% to 0.7053 compared to the opening levels at 0.7084, after hitting a two-month low of 0.7050, while the session reached a high of 0.7092.

We followed the speech of Australian Central Bank Governor Philip Lowe at the Australian Financial Business Summit in Sydney, where he spoke of the Reserve Bank of Australia's interest rate at a historic low of 1.50% at Tuesday's meeting to support the Australian economy.

Lowe said that keeping interest rates at current low levels supports job creation and moving ahead with the inflation target, adding that achieving the goal of full employment is very important because the labor market is central to the expected recovery of inflation, explaining that labor market tightening will increase wage growth Which should boost household income and expenditure and provide a balanced weight to the recent fall in house prices.

The recovery in household spending in Australia is expected to lead to the growth of inflationary pressures, of course, and inflationary pressures can be recovered for other reasons, he said, noting that the likelihood of this happening at the moment is low, suggesting that inflation growth is currently dependent on The strength of the labor market, which reflects good performance other than other economic indicators that reflect a more softer image.

Loye noted that markets are looking to reveal growth data for the fourth quarter, noting that growth data for the second half of last year 2018 were clearly less than the first half, reflecting a global image in many countries, including Australia, adding that there is tension Growing data from the strong labor market and more resilient GDP data and that the Australian Central is devoting extensive resources to understanding this tension.

This was before we saw GDP reading, which showed a slowdown in growth to 0.2% from 0.3% in the third quarter, in contrast to expectations of a 0.5% growth rate, while annual GDP growth slowed to 2.3% versus 2.7% In the previous year's third-quarter reading, was worse than expected, with growth slowing to 2.6%.

On the other hand, the markets are currently waiting for the US economy to release preliminary data for the labor market with the publication of the index of change in private sector jobs, which may reflect the slow pace of job creation to 190 thousand added jobs compared with 213 thousand jobs added in January, Hours before the release of the monthly report of non-agricultural jobs and unemployment rates in addition to the average income per hour for the last month.

Investors are also looking for a trade balance, which could reflect a widening deficit to $ 57.8 billion versus $ 49.3 billion in November, and the expected talk of FOMC member and New York Bank Chairman John Williams at the New York Economic Club, About the Beige Book report, which is important in being issued two weeks before the FOMC meeting.

Technical Analysis

The Australian dollar fell against the US dollar and managed to breach the support level 0.7065 under negative pressure from the moving averages that are in a bearish order above the price and pushed it towards the next support level at 0.7027

The Stochastic is reflecting a bearish cross between its lines and entering the oversold area, indicating a bearish sell-off and a strong support level of 0.7027

General trend of the movement: bearish