AUD Daily Updates

12 December 2017

The Australian dollar is rising this morning despite disappointing business confidence and house price index numbers. Business conditions came in at 12 (vs. 21 prior) while confidence fell to 6 (vs. 8 prior). Quarter-over-quarter house prices fell by 0.2% (vs. 0.5% expected). While the currency initially fell following the economic data releases, the Aussie has since strengthened. The Australian dollar is gaining against all major peers including the US dollar, the euro and the British pound. Despite today's strength, our short-term and medium-term trending indicators continue to suggest a bearish trend. 

AUD/USD is currently up and trading just above 0.7540. Looking at EUR/AUD, the pair is down and currently just above 1.560. The GBP/AUD exchange rate is down and currently above 1.7680.  

This is a pretty light week for economic data and events relating to the Australian dollar. Business conditions came in at 12 (vs. 21 prior) while confidence fell to 6 (vs. 8 prior). Quarter-over-quarter house prices fell by 0.2% (vs. 0.5% expected). Tomorrow, we’ll see Westpac consumer confidence as well as speeches by RBA Governor Philip Lowe. On Thursday we’ll see changes in employment as well as the unemployment rate. Last week, GDP growth missed expectations on consumer weakness.

Updated 
Short term outlook
Bearish

As the Australian dollar continues to sell off following China's 19th Party Congress, we are downgrading the currency to bearish. Looking at a daily chart of the Aussie, the currency is trading within normal conditions. This is based on various technical indicators.  

Medium term outlook
Bearish

As the currency weakens on lower rate hike expectations and slow growth, we are now bearish on the Australian dollar in the medium-term. Looking at a weekly chart, the Aussie is trading within normal conditions. Our analysis is based on various technical indicators.  

Updated