- It weakens the Australian dollar because the disappointing US employment data increases the feeling of risks.
- The NFP report in the United States came below expectations, while wages slowed, which raised concerns about economic flexibility.
- China’s trade data revealed weaker imports, which inflated the Australian pressure.
- Technical indicators indicate an increase in the risk of the negative side as AUD/USD is close to the main support levels.
The Australian dollar extended the losses on Friday against the US dollar after the US salary report was issued in the United States (NFP). The AUD/USD pair has struggled to recover with the deterioration of risk morale with the reaction of merchants with weaker job growth more than expected and the most enlarged wage gains. Meanwhile, trade balance data in China showed an unexpected decrease in imports, which raised concerns about the slowdown, which weighted more on the Australian dollar.
Daily Digest Market Movers: The Australian dollar under pressure after Miss NFP
- The salary salary report in the non -agricultural United States showed that creating job opportunities slowed in February with the addition of 151,000 new jobs, and estimated 160,000 estimates. Although it still improves No. 125,000 in January, the weakest employment pace raised concerns about the flexibility of the labor market.
- The average profit growth per hour decreased to 0.3 % of my mother, a decrease from 0.4 % in January, which enhances expectations that wage pressure may be cooling. Meanwhile, the unemployment rate in the United States increased to 4.1 %, indicating a possible softening in working conditions.
- China’s trade surplus expanded to $ 170.52 billion in February, which exceeds expectations. However, a severe decrease of 8.4 % in imports has sparked concerns about the weakening of local demand, which may negatively affect the economy that Australia moves.
- The Australian Reserve Bank (RBA) maintains cautious expectations, expecting the economy to grow with a rise of 2 % by 2025. While this position has supported AUD in the past, investors have become cautious about potential policy transformations in response to inflation and labor market conditions.
- Risk morale was strained when investors reassessed global trade developments. Canada delayed the second planned round of revenge definitions against the United States until April 2, after exemptions granted to Mexican and Canadian goods under the USMCA agreement. This development only provided temporary relief with broader concerns about continuing global trade tensions.
Aud/USD technical analysis: The pressure sale is escalating with the approaching main support
The Australian dollar extended its decrease on Friday, as it decreased towards a zone 0.6290 during the American session with increased pressure pressure. The husband failed to maintain its previous levels after the US NFP report increased the weakest of caution in the market, prompting more negative movement.
The MACD is the index of the decreased red graph, indicating the weakening of the upscale momentum. Meanwhile, the RSI index decreased to 53, which decreased sharply but remains higher than neutral levels. If RSI continues to slip, it may confirm more negative risks.
The certain decrease can open less than the support area of 0.6300 door for more losses with the next key level around 0.6270. On the upper side, the resistance remains at 0.6365 with a break above this level required to turn feelings again towards the bulls.
Questions and answers in Australian dollars
One of the most important factors for the Australian dollar (AUD) is the level of interest rates set by the Australian Reserve Bank (RBA). Since Australia is a resource -rich country, the other main engine is the largest export price, iron ore. The health of the Chinese economy, the largest commercial partner, is a factor, as well as inflation in Australia, the rate of growth and commercial balance. Market morale-whether investors are eating more risky assets (risk) or searching for safe materials (risk)-is also a worker, with positive risks for AUD.
The Australian Reserve Bank (RBA) affects the Australian dollar (AUD) by determining the level of interest rates that Australian banks can persuade each other. This affects the level of interest rates in the economy as a whole. The main goal of RBA is to maintain a stable inflation rate of 2-3 % by setting interest rates up or down. Relatively high interest rates are supported compared to other main central banks, and relatively low vice versa. RBA can also use and tighten quantitative dilution to influence credit conditions, with previous AUD negative and positive to AUD.
China is the largest commercial partner in Australia, so the health of the Chinese economy is a major impact on the value of the Australian dollar (AUD). When the Chinese economy does a good job, it buys more raw materials, commodities and services from Australia, raising the demand for AUD, and raising its value. The opposite is the case when the Chinese economy does not grow at the speed available. Positive or negative surprises in Chinese growth data, therefore, they often have a direct impact on the Australian dollar and its wives.
Iron Ore is the largest export in Australia, as it represents 118 billion dollars annually according to data from 2021, with China as its main destination. Therefore, the price of iron ore can be an engine for the Australian dollar. In general, if the price of iron ore rises, the AUD also rises, as the total demand for the currency increases. The opposite is the case if the price of iron ore decreases. Iron ore prices also tend to increase the possibility of a positive commercial balance for Australia, which is also positive for AUD.
The commercial balance, which is the difference between what a country gains from its exports in exchange for what it pays to its imports is another factor that can affect the value of the Australian dollar. If Australia produces very required after exports, its currency will obtain a value of the excess demand created from foreign buyers who seek to buy its exports in exchange for what it spends to buy imports. Therefore, the positive net trade balance enhances AUD, with the opposite effect if the trade balance is negative.
