The Australian Dollar (AUD) entered Friday around the 0.6650 region after dropping below 0.6600 Thursday as risk mood deteriorated, the fallout from two US bank closures impacting. Australian employment data beat expectations in February the jobless rate underpinning the modest push higher. The Unemployment Rate dropped to 3.6% from 3.5% marking the lowest rate since the 1970’s. Speculation on how much the Fed will raise rates at next week’s meeting is hotting up with punters divided on a 25- or 50-point hike. US data of late has been positive although inflation is still stubbornly high after easing from 6.4% to 6.0% during the week- good- but not good enough. The forecast to the end of January was for a 25-point hike, now this is 50 points – some may say not justified if we consider the recent two US bank closures. The hellbent approach to destroying high inflation may have the Fed seeing too much “red”. The downward spiral from 0.7100 numbers in early February looks to continue its bear run. Support seen at 0.6520, if the Fed raises 50 points next week this may come into view.
The current interbank midrate is: AUDUSD 0.6655
The interbank range this week has been: AUDUSD 0.6588- 0.6715