AUD/USD Exchange Rate Forecast: Australian Dollar Weakness Persists, Chinese Imports Fall

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100 Hundred United States Dollars (USD)

The Australian Dollar to US Dollar (AUD/USD) exchange rate was trending in the region of a four-and-a-half-year low on Monday following the publication of disappointing Chinese trade data.

The weakness in the Australian Dollar to US Dollar exchange rate was also due to the lingering influence of last week’s unexpectedly strong US Non-Farm Payrolls report.

The US employment data showed that the nation added over 300,000 positions in November – upping the odds of the Federal Reserve raising interest rates earlier than currently projected.

Australian Dollar to US Dollar Slides after US Jobs Gain, Fed Rate Bets

In the view of industry expert Stephen Innes; ‘The ‘Aussie’ is trading either side of AU$0.8300, down from AU$0.8375 on Friday. All told, the Dollar fell more than 2% last week after several investment banks changed their global rates forecasts, which now includes a Reserve Bank of Australia interest rate cut. Between that and the strong US jobs report, the ‘Aussie’ has been on its heels from the get-go this morning.’

Innes continued; ‘NFP gains soared by 321,000 jobs versus the 225,000 increase that was expected. Add it up and 2014 has proven to be America’s strongest year of job growth since 1999.’

The fact that the level of imports in China (Australia’s largest economy) unexpectedly tumbled in November inspired further Australian Dollar losses, and the pairing eased lower still during the local session.

The Australian Dollar to US Dollar (AUD/USD) exchange rate fell to a low of 0.8255.

That being said, the US Dollar did pare some of its gains as the US Labour Market Conditions index for November fell from a negatively revised 3.9 to 2.9.

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

The reports most likely to provoke Australian Dollar to US Dollar (AUD/USD) exchange rate movement in the hours ahead include the ANZ Roy Morgan Weekly Consumer Confidence Index and the National Australia Bank Business Conditions/Confidence reports.

Tuesday’s US NFIB Small Business Optimism index could also prompt some AUD/USD volatility.

The Australian Dollar to US Dollar (AUD/USD) exchange rate was trading in the region of 0.8309 during the North American session.

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