The Australian dollar rose against its US counterpart in today's trading following the release of positive economic data and cautious calm in the global markets. There is calm and cautious anticipation in the markets after the strong losses recorded by stock exchanges yesterday, affected by fears of a possible recession in the United States.
This follows the reversal of the yield curve on US Treasury bonds, which analysts see as a sign of an imminent recession.
Faced with mounting signs of a recession, global central banks are slashing interest rates to attract capital and stimulate economies.
The Australian economy added 41.1 thousand jobs last month, exceeding analysts' expectations of 14.2 thousand jobs, and the unemployment rate held steady at 5.2% unchanged, government data showed.
Investors in the US economy are awaiting the release of the housing market data with the release of the Housing Starts and Building Permits for July. Building permits are expected to rise 3.1% to 1.27 million versus a decline of 6.1% at 1.23 million in June. Housing starts may show a rise of 0.2% to 1.26 million versus a decline of 0.9% at 1.25 million.
This comes ahead of the preliminary reading of the University of Michigan's consumer confidence index, which may reflect a shrinking expansion to 97.2 vs. 98.4 in July. Otherwise, US President Donald Trump yesterday continued his criticism of the Federal Reserve for interest on federal funds, saying it was delayed In reducing them to support the American economy, adding that imposing tariffs on China did not harm the economy, but made billions of dollars for his country.
The narrow and sideways range continues to dominate the AUDUSD trades, which hold steady below 0.6830, thus, no change to our bearish outlook which is supported by the stochastic negativity, noting that our next key target is at 0.6700.
Expected trading range for today is between 0.6720 support and 0.6830 resistance.
Expected trend for today: Bearish.