AUD/USD testing bearish commitments below 0.7020/50 ahead of key US events

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AUD/USD testing bearish commitments below 0.7020/50 ahead of key US events AUDUSD Currencies Fed GDP RBA

h the pair rallying within a 160 pip range from a low of 0.7082 to a high of 0.7108. Nevertheless, the market has piped down as we await yet more critical data for the day ahead from theFollowing yesterday's inflation data that came in hotter than expected for the Australian economy, traders will be rolling up their sleeves as a slew of US numbers will hit the screens at the start of the day.

Ahead of this data, WIRP suggests a Federal Reserve interest rate hike of 25 bp on February 1 is fully priced in, with less than 5% odds of a larger 50 bp move. Another 25 bp hike on March 22 is about 80% priced in, while one last 25 bp hike in Q2 is only 35% priced in. The sentiment has been a weight for the greenback, helping to support AUD/USD as it climbed towards fresh cycle highs made on the back of yesterday's CPI data.

''We continue to expect the AUD to perform well this year relative to a basket of G10 currencies. That said, we look for a dip in the value of AUD/USD around the middle of the year,'' the analysts said. ''This is linked with our expectation that the market will price out expectations of a Fed rate cut before the end of 2023.''above, showing that the pair is climbing trendline support. However, should the bears move in to guard 0.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

 

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