AUD/USD Fundamental Analysis – Forecast for the week of September 19, 2016

The AUD/USD will open in the new week at 0.7489 weighed down by the strength of the US dollar and lackluster jobs data. The Aussie is down 0.69% for the week and is neutral moving into the new week. The central bank meeting this week will determine the course of this currency. The US dollar surged late on Friday weighing on all of its crosses. The RBA minutes this week will be the highlight for the Aussie.

The Australian dollar fell by almost a quarter of a US cent after the release of the August employment numbers), which showed the number of people with jobs fell 3,900, the first fall since February.

The US dollar surged late on Friday while US economic data has mostly underperformed relative to consensus forecasts since late July, decidedly hawkish comments from Yellen and Fed Vice Chair Fischer set off speculation of imminent tightening. This sense has been reinforced by saber-rattling from most other policymakers that have opined since. Investors will look for guidance that reconciles this disparity. Augusts’ stronger-than-expected inflation reading and nonfarm payrolls growth averaging above the 190k cited by Ms Yellen as supportive of a hike certainly help. However, explicitly singling out these developments as formative may be needed to guide market expectations through the fog of conflicting news-flow.

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This Week’s Economic Events That You Should Be Monitoring:

Date Country Name Volatility Previous
9/20/2016 AUD RBA Meeting’s Minutes 3
9/20/2016 CAD BoC Governor Poloz 3
9/21/2016 AUD Mid-Year Economic Outlook 3
9/21/2016 JPY BoJ Interest Rate Decision 3 -0.1
9/21/2016 JPY BoJ Monetary Policy Statement 3
9/21/2016 JPY BoJ Press Conference 3
9/21/2016 USD FOMC Economic Projections 3
9/21/2016 USD Fed’s Monetary Policy Statement 3
9/21/2016 USD Fed Interest Rate Decision 3 0.5
9/21/2016 USD FOMC Press conference 3
9/21/2016 NZD RBNZ Interest Rate Decision 3 2
9/22/2016 EUR ECB President Draghi’s Speech 3
9/23/2016 AUD RBA’s Governor Lowe Speech 3

Government Bond Auctions

Date Time           Country               Auction

Sep 19 11:00 Belgium Eur 2.8-3.5bn 4.5% Mar 2026,

Sep 20 11:30 UK Gbp 2.5bn 1.5% Jul 2047 Gilt

Sep 21 10:30 Denmark Holds bond auction

Sep 21 11:03 Sweden Sek 2bn 4.25% Feb 2019 & Sek 1.5bn 1.5% Nov 2023 bonds

Sep 21 11:30 Germany Eur 4bn 0% Oct 2021 Bobl

Sep 22 17:20 Italy Announces details of bond auction

Sep 22 19:00 US Usd 11bn 0.125% Jul 2026 TIP

Sep 26 11:30 Germany Eur 1.5bn Sep 2017 Bubill

Sep 26 13:00 Norway Details of bond auction on Sep 28

Sep 27 11:00 Netherlands Eur 0.75-1.25bn 4% Jan 2037 DSL

Sep 27 11:10 Italy Holds zero coupon/BTP€i auction

Sep 28 11:05 Norway Holds bond auction

Sep 28 11:30 Germany Eur 4bn Sep 2018 Schatz

Sep 29 11:03 Sweden Holds I/L bond auction