AUD/USD Exchange Rate Forecast: Australian Dollar Edges Higher as Yen Outperforms ‘Greenback’

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United States Dollars (USD)

The Australian Dollar to US Dollar (AUD/USD) exchange rate recouped some of its recent losses during the North American session as the US Dollar eased lower against several of its most traded peers.

The Australian Dollar to US Dollar (AUD/USD) exchange rate fell on Monday after below-forecast Chinese trade data sparked concerns regarding Australia’s economic outlook and pushed investors towards safe-haven assets.

Australian Dollar to US Dollar (AUD/USD) Exchange Rate Declines after ‘Aussie’ Reports

While a slide in the US Labour Market Conditions Index (from 3.9 to 2.9 in November) helped the ‘Aussie’ stage a modest rebound, the South Pacific currency’s modest uptrend was abruptly halted by the publication of below forecast reports for Australia.

The nation’s ANZ Roy Morgan Consumer Confidence index dropped from 113.9 to 110.4 in the week ending December 7th.

The National Australia Bank (NAB) then published its Business Conditions and Business Confidence reports.

The measure of business conditions fell from 13 to 5 while the gauge of business confidence dropped from 5 to 1.

This, in conjunction with the news that NAB is now forecasting two interest rate cuts in 2015, put the Australian Dollar under pressure.

AUD/USD Exchange Rate Ekes out Modest Gain

However, the Australian Dollar to US Dollar (AUD/USD) exchange rate later posted a small advance as the ‘Greenback’ declined amid a slide in Asian and European stocks.

Demand for the safe-haven Yen increased as a result of the developments.

According to forex strategist Lee Hardman; ‘The Yen has strengthened amidst more risk-averse trading conditions as global equity markets and commodity prices have declined. The US Dollar has also pared some recent gains amidst the sell-off, which may be more a reflection of increasingly elevated long-Dollar positions’.

The AUD/USD exchange rate continued trending in a slightly softer position even as the US NFIB Small Business Optimism measure rose from 96.1 to 98.1. A smaller increase to 96.5 had been anticipated.

Australian Dollar to US Dollar (AUD/USD) Exchange Rate Forecast

During the Australasian session the Australian Dollar to US Dollar (AUD/USD) exchange rate could fluctuate in response to Australia’s Westpac Consumer Confidence data and the nation’s home loans figures.

Home loans are expected to have increased by 0.1% on the month in October following a decline of -0.7% in September.

The Australian Dollar to US Dollar (AUD/USD) exchange rate fell to a low of 0.8221.

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