AUD/USD Forecast Dec. 20, 2011, Fundamental Analysis

AUD/USD Forecast Dec. 20, 2011, Fundamental Analysis
AUD/USD Forecast Dec. 20, 2011, Fundamental Analysis
The AUD/USD pair retreated early Monday, as the US dollar gained momentum with the uncertainty regarding the global outlook, while demand dropped for the Aussie with the RBA’s dovish stance.

The current market sentiment pushed the higher-yielding currencies down, as risk aversion controlled the FX market and supported the US dollar especially after the announcement of the death of North Korea’s leader Kim Jon-il.

The latest RBA decision to cut the interest rate to 4.25% reduced demand for the Australian dollar. While the RBA will release its Board meeting minutes for December, which will show officials’ reasons behind cutting the interest rate.

On Tuesday at 23:30 GMT (Monday), the Australian economy will issue the Conference Board Leading Index for October which had a previous reading of 0.1%.

At 00:30 GMT, the Reserve Bank of Australia will release the Board’s December meeting minutes, where the central bank will announce its reasons behind its last rate cut.

The U.S. economy will release the Housing Starts for November at 13:30 GMT, where it’s expected to show a rise of 0.3% to 630 thousand compare to the prior drop of 0.3%.

As for the U.S. Building Permits it’s expected to drop 1.4% to 635 thousand from 653 thousand.

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