Australian Dollar to US Dollar (AUD/USD) Exchange Rate Forecast to Dive after US Jobs Data Impresses

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United States Dollars (USD)

The Australian Dollar to US Dollar (AUD/USD) exchange rate declined by around -0.66% on Friday afternoon.

After Australian economic data printed positively on Friday, the ‘Aussie’ (AUD) strengthened versus many of its most traded currency competitors. Additional gains can be attributed to improved market sentiment after crude prices held above $50 a barrel.

The US Dollar, meanwhile, strengthened across the board after labour market data exceeded expectations. With the Federal Reserve stating that policy changes would be subject to data, rate hawks will be hoping that positive results will pressure the Federal Open Market Committee (FOMC) into hiking rates.

The Australian Dollar to US Dollar (AUD/USD) exchange rate is currently trending in the region of 0.7735.

Australian Dollar (AUD) Exchange Rate Gains on Foreign Exchange Reserves

The Reserve Bank of Australia (RBA) Foreign Reserves increased from A$62.5 billion to A$64.3 billion in February. This allowed the South Pacific asset to advance versus many of its most traded currency competitors.

Additional gains can be attributed to rising crude prices as tensions in Libya mount. ‘Supply disruptions have certainly come back into focus for now,’ Virendra Chauhan, oil analyst at consultancy Energy Aspects, told Reuters Global Oil Forum. ‘Libya is noteworthy because militant attacks on infrastructure are increasing.’

The Australian Dollar to US Dollar (AUD/USD) exchange rate dropped to a low today of 0.7710.

US Dollar (USD) Exchange Rate Rallies on Labour Data

After US jobs data printed impressively, the ‘Greenback’ (USD) surged versus its major peers. Change in Non-Farm Payrolls added 295,000 new jobs; eclipsing both the median market forecast and the previous figure. Also, Unemployment Rate dropped to just 5.5% of the population, well below the market consensus of 5.6% and previous figure of 5.7%.

The jobs report looks ‘unambiguously strong’ said Neil Dutta, head of US economics at Renaissance Macro Research LLC. ‘June is still the base case’ for rates to rise, he said. ‘The probability of September is falling rapidly.’

‘It virtually cements the removal of the ‘patient’ language at the March meeting,’ said Aneta Markowska, chief US economist at Societe Generale SA in New York. ‘It keeps the June rate hike in play.’

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

Given the extent of the declination, the Australian Dollar to US Dollar (AUD/USD) exchange rate is likely to hold losses for the remainder of Friday’s trade. The coming week ought to see heightened AUD/USD volatility with several data publication pertaining to both nations.

The Australian Dollar to US Dollar (AUD/USD) exchange rate advanced to a high today of 0.7846.

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