Join our community of traders FOR FREE!

  • Learn
  • Improve yourself
  • Get Rewards
Learn More

AUD/USD extended gains from the prior trading day on Wednesday and traded not far from Monday’s three-month high of 0.7408, as upbeat Australian GDP data as well as hopes of additional US economic stimulus and more positive headlines regarding coronavirus vaccines supported investor risk sentiment.

A report by the Australian Bureau of Statistics showed earlier on Wednesday that the nation’s economy had expanded at a quarterly rate of 3.3% during the three months to September, while outstripping a consensus of analyst estimates pointing to a 2.6% growth. It has been the fastest rate of expansion since the first quarter of 1976, as economic activity resumed amid the pandemic.

Household consumption rose at a record quarterly pace, by 7.9%, in Q3 after a 12.5% drop in the previous quarter. Government spending continued to increase in Q3, by 1.4%.

In annual terms, Australia’s GDP shrank 3.8% during the third quarter, or at a slower rate than anticipated (-4.4%).

Despite “good” macro data, however, the country still has a long way to full recovery, according to Reserve Bank of Australia Governor Philip Lowe.

Lowe also said he kept an “open mind” on whether to increase the central bank’s AUD 100 billion bond-purchasing programme, with much depending on the pace of recovery.

“We expect the RBA will either remove or increase the target yield by the middle of next year, which will further support AUD in 2021,” Kim Mundy, a senior economist at CBA, was quoted as saying by Reuters, while referring to RBA’s 0.1% target for three-year bond yields.

“We expect AUD will lift to $0.7800 by year-end,” Mundy added.

As of 10:26 GMT on Wednesday AUD/USD was edging up 0.13% to trade at 0.7378, after earlier touching an intraday high of 0.7393, or a level not seen since November 30th (0.7408). The major pair appreciated 4.48% in November, which marked its best monthly performance since April.

In terms of US macroeconomic data, today market players will be paying attention to the monthly data on private sector employment change by ADP due out at 13:15 GMT.

Additionally, several Federal Reserve officials are expected to make speeches, including a testimony by Fed Chair Jerome Powell at 15:00 GMT.

Bond Yield Spread

The spread between 2-year Australian and 2-year US bond yields, which reflects the flow of funds in a short term, equaled -5.8 basis points (-0.058%) as of 9:15 GMT on Wednesday, up from -6.6 basis points on December 1st.

Daily Pivot Levels (traditional method of calculation)

Central Pivot – 0.7360
R1 – 0.7382
R2 – 0.7395
R3 – 0.7417
R4 – 0.7439

S1 – 0.7347
S2 – 0.7325
S3 – 0.7311
S4 – 0.7298

TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover Forex, Price Action and Social Trading.

Related News

  • Forex Market: GBP/USD daily trading outlookForex Market: GBP/USD daily trading outlook Yesterdays trade saw GBP/USD within the range of 1.3902-1.4019. The pair closed at 1.3960, rising 0.32% on a daily basis. It has been the 16th gain in the past 42 trading days and also a second consecutive one. The daily high has been the […]
  • Forex Market: USD/CAD daily forecastForex Market: USD/CAD daily forecast During yesterday’s trading session USD/CAD traded within the range of 1.0891-1.0922 and closed at 1.0918.At 11:14 GMT today USD/CAD was gaining 0.19% for the day to trade at 1.0929. The pair touched a daily high at 1.0942 at 6:20 GMT, […]
  • Forex Market: GBP/USD daily trading outlookForex Market: GBP/USD daily trading outlook Friday’s trade saw GBP/USD within the range of 1.4408-1.4517. The pair closed at 1.4481, inching up 0.01% on a daily basis. It has been the 26th gain in the past 55 trading days and also a third consecutive one. The daily high has been the […]
  • Nestle SA’s share price up, plans $8.8-billion share buyback as H1 sales beat estimatesNestle SA’s share price up, plans $8.8-billion share buyback as H1 sales beat estimates The biggest food company by sales in the world – Nestle SA revealed in an official statement today that it intends to spend 8 billion Swiss francs ($8.8 billion) in a share buyback as it posted upbeat first-half revenue growth.According to […]
  • Forex Market: CAD/CHF daily forecastForex Market: CAD/CHF daily forecast During yesterday’s trading session CAD/CHF traded within the range of 0.8360-0.8410 and closed at 0.8362.At 6:19 GMT today CAD/CHF was losing 0.04% for the day to trade at 0.8360. The pair touched a daily high at 0.8356 at 4:45 […]
  • Google uses Android to draw attention to Plus social networkGoogle uses Android to draw attention to Plus social network The tech giant Google said on Tuesday that it aims to tie the Android operating system, used on the majority of the world’s smartphones, more closely to Google Plus to encourage people to upload their photos to the social networking service […]