After a disappointing U.S. durable goods figure, the AUDUSD is waiting for GDP growth numbers to be released.
AUDUSD – Daily Chart
Australian Dollar Bearish Run
The AUDUSD exchange fell through the support of the uptrend channel and now looks for support at the lows of early January. The GDP release could be a key driver of the next path for the Aussie dollar.
The latest release of U.S. durable goods orders was worse than expected, with a 4.5% decline, but it was largely attributed to Boeing. Economists polled by the Wall Street Journal had expected a 3.6% drop in orders for durable goods. However, with transportation stripped out of the numbers, new orders rose 0.7% last month.
Additionally, a key measure of business investment increased the fastest since last summer. Boeing received 250 contracts in December, which provided a 5.1% surge in U.S. durable goods orders. With an expected drop in rankings, January saw only 55 at the aerospace giant. The annual rate of growth in business investment slowed once again to 4.3% from 5% — less than half the pace of one year ago.
The Australian dollar has been under pressure as the economy remains strained. Stubborn inflation has led to the most significant fall in real wages on record down under. The Australian Bureau of Statistics released the seasonally adjusted Wage Price Index last week, which showed an 0.8% cent increase in the December quarter, or 3.3% annually. But the actual value of wages has fallen as inflation is at 7.8%, with the gap between wages and prices now 4.5%.
Analysts Overview
Analysts will look for an improvement in the GDP numbers, but a fall to 2.7% annually is expected from last quarter’s 5.9% figure. The Aussie dollar has been weak, and traders should look to play the downside on weak GDP numbers toward the 0.6600 level versus the U.S. dollar. The Federal Reserve is expected to continue hiking rates after stubborn inflation, supporting the greenback.
