AUD/USD lower ahead of Federal Reserve meeting next week

Australian dollar was trading lower against its US counterpart on Friday, as market players eyed the announcement of asset purchase tapering by the Federal Reserve Bank next week.

AUD/USD fell to a session low at 0.9222 at 5:43 GMT, after which consolidation followed at 0.9239, still losing 0.37% for the day. Support was likely to be received at September 6th low, 0.9117, while resistance was to be encountered at June 10th high, 0.9480.

Earlier in the week, following solid economic numbers out of China, the Aussie registered gains against the US dollar. However, on Thursday this upward movement was postponed, after a report said that the number of employed people in Australia decreased by 10 800 in the month of August compared to July, when the number dropped by 11 400. Experts had projected that the number of employed will increase by 10 000. At the same time, the unemployment rate rose to the highest in four years, reaching 5.8% in August, as a month earlier the rate stood at 5.7%.

Another report by the Melbourne Institute showed that inflationary expectations fell to 1.5% in the month of August, from 2.3% during the preceding month.

Meanwhile, the Australian dollar and other high-risk currencies are considered vulnerable to Federal Reserves intentions of scaling back its bond-buying program, as recent data out of the United States suggested that the central bank might have room to implement its plans. On Thursday the Department of Labor said that the number of initial jobless claims in the United States dropped by 31 000 to 292 000 during the week ending on September 7th, marking their lowest point since April 2006. Experts had anticipated that claims will rise to 330 000, following the non-revised 323 000 claims during the preceding week. According to a survey by Bloomberg News, Fed was expected to reduce the scale of its easing program to 75 billion USD per month at its upcoming meeting on September 17-18th.

Later in the day the United States was to release a series of vital indicators, which includes retail sales, producer price inflation, business inventories and the preliminary value of the consumer confidence index. Retail sales are a strong indication of the consumer spending tendency and overall economic development in the country, as better than projected results may heighten the appeal of the greenback.

Elsewhere, the Australian currency was steady against the kiwi dollar, with AUD/NZD cross ticked up 0.03% to trade at 1.1401 at 6:32 GMT. EUR/AUD pair was gaining 0.21% on a daily basis to trade at 1.4378 at 6:39 GMT.