The value of the Australian Dollar has been relatively low of late, with the continuing lack of resolution for the election doing little to improve the mood of investors.
The US Dollar has similarly declined on the whole, on account of the prospect of a Fed rate hike getting further away with every release from the central bank.
The Australian Dollar has been in a sorry state lately, having dipped against most of its peers due to continuing concerns about the future state of the economy against the backdrop of a stagnant election outcome.
The latest news has been that the Coalition have once again edged closer to an overall majority, though as the waning confidence in the ‘Aussie’ has shown, investors are getting impatient for a resumption of ‘business as usual’.
Another major source of damage for the Australian Dollar has been the decision by Standard and Poor’s to lower the outlook on Australia’s AAA credit rating, from stable to negative.
In reference to the decision, S&P said:
‘The negative outlook on Australia reflects our view that prospects for improvements in budgetary performance have weakened following the recent election outcome’.
The perceived value of the US Dollar has been low of late, due in part to the revelations of the Federal Reserve’s June minutes for its untouched interest rate decision.
As a number of speculators had forecast, the central bank linked its lack of a rate hike last month with concerns about the outcome of the EU Referendum. As the UK voted for the more instability-linked ‘Brexit’, the odds of a US rate hike in the near-term are very slim indeed.
Despite Fed officials including Chair Janet Yellen stating earlier in the year that at least two interest rate hikes were likely, the mainly dovish attitudes of Fed officials post-‘Brexit’ has resulted in many economists pushing their predictions for a rate increase all the way ahead to 2017 at the earliest.
No further Australian economic announcements are expected this week, therefore the next influence to be had on the pairing is set to come from the US.
Tonight will see the release of the June non-farm payrolls result, as well as the unemployment rate for the same month.
With payrolls, a rise from 38k to 170k is expected, while the unemployment rate is pessimistically expected to rise from 4.74% to 4.8%.
The Australian Dollar to US Dollar (AUD/USD) exchange rate has been trending in the region of 0.7519 and the US Dollar to Australian Dollar (USD/AUD) exchange rate has been trending in the region of 1.3303 recently.
Disclaimer: Currency-Converter.com.au and its data provider, TorFX, make no claims regarding the validity or exactness of the information provided in on this site and will not be held liable for any use, interpretation, or other implementation of the information provided. Currency-converter.com.au make no warranties, express or implied, as to results to be obtained from use of such information, and make no express or implied warranties of condition, quality, performance, merchantability or fitness for a particular purpose or use. Currency-converter.com.au shall not have any liability for the accuracy of the information contained in the services provided or ommissions there in which are made available on a free, as-is basis. None of the aforementioned parties shall be liable for any third party claims or losses of any nature, including, but not limited to, lost profits, punitive, consequential, special, incidental, indirect or similar damages even if advised of the possibility of such damages. Rates offered are interbank rates and may not be the same as offered by your financial institution, and do not include commissions. Rates shown on this site will vary from those provided by TorFX or other providers linked to from this site.