AUD/USD stabilizes as US dollar Softens,but China concerns limit gains
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The AUD/USD pair experienced a slight recovery in the European session on Monday, holding above the key support level of 0.6580. This uptick comes amid a softer US Dollar as investors gear up for a busy week of economic data releases in the United States. However, concerns over China’s economic outlook continue to cast a shadow on the Australian Dollar’s potential rebound.
AUD/USD stabilizes as US dollar Softens,but China concerns limit gains
US Dollar Eases Ahead of Key Economic Data
The US Dollar is trimming recent gains following Friday’s data, which suggested that while the Federal Reserve may ease policy, any cuts will likely be gradual. Durable Goods Orders outperformed expectations, as did the Michigan Consumer Sentiment Index, adding to a more tempered outlook for Fed policy shifts. This week, however, could shift sentiment as investors watch for Q3 GDP data on Wednesday, the PCE Price Index on Thursday, and the Nonfarm Payrolls report on Friday.
China’s Economic Struggles Weigh on the Australian Dollar
In Australia, the Reserve Bank’s (RBA) hawkish stance is failing to boost the Aussie meaningfully, largely due to ongoing economic struggles in China, Australia’s primary trading partner. Recent data showed a 27% year-on-year decline in China’s industrial profits, highlighting the country’s erratic economic recovery and pressuring the Australian Dollar as it relies on demand from Chinese industries.
Outlook: AUD/USD Faces Key Support and Persistent Headwinds
While the AUD/USD pair remains close to a two-month low at 0.6580, its upside is limited by the challenging economic backdrop in China. As markets digest a heavy US data schedule, investors may find the Aussie’s recovery capped until China shows clearer signs of stabilization. The week’s data could provide the AUD/USD with needed support if the US outlook softens, but the pair may continue to test its lower support levels.
AUD/USD stabilizes as US dollar Softens,but China concerns limit gains
US Dollar Eases Ahead of Key Economic Data
The US Dollar is trimming recent gains following Friday’s data, which suggested that while the Federal Reserve may ease policy, any cuts will likely be gradual. Durable Goods Orders outperformed expectations, as did the Michigan Consumer Sentiment Index, adding to a more tempered outlook for Fed policy shifts. This week, however, could shift sentiment as investors watch for Q3 GDP data on Wednesday, the PCE Price Index on Thursday, and the Nonfarm Payrolls report on Friday.
China’s Economic Struggles Weigh on the Australian Dollar
In Australia, the Reserve Bank’s (RBA) hawkish stance is failing to boost the Aussie meaningfully, largely due to ongoing economic struggles in China, Australia’s primary trading partner. Recent data showed a 27% year-on-year decline in China’s industrial profits, highlighting the country’s erratic economic recovery and pressuring the Australian Dollar as it relies on demand from Chinese industries.
Outlook: AUD/USD Faces Key Support and Persistent Headwinds
While the AUD/USD pair remains close to a two-month low at 0.6580, its upside is limited by the challenging economic backdrop in China. As markets digest a heavy US data schedule, investors may find the Aussie’s recovery capped until China shows clearer signs of stabilization. The week’s data could provide the AUD/USD with needed support if the US outlook softens, but the pair may continue to test its lower support levels.