Disappointing Economic Data, Why Is the Aussie Rising?
The Australian Dollar (AUD) rose and reached a three-week high against the US Dollar (USD) during Wednesday's Asian session. This rise occurred despite less-than-satisfactory Australian economic data.
The Australian Bureau of Statistics reported that third-quarter economic growth fell to 0.4% from 0.6% previously, a figure lower than market expectations. Typically, such poor data would put pressure on the AUD, but this time it had little impact.
One factor was the hawkish stance of the Reserve Bank of Australia (RBA). RBA Governor Michele Bullock stated that inflation remains higher than expected. This statement led the market to believe that the RBA would not cut interest rates anytime soon, thus supporting the AUD's strength.
Meanwhile, the US Dollar weakened as markets grew more confident that the Federal Reserve (The Fed) would cut interest rates this month. This weakening USD also helped AUD/USD remain on a positive track. Market participants are now awaiting the release of key US data, namely the ADP employment report and the ISM Services PMI, for clues on future market movements. (Asd)
Source: Newsmaker.id
