Â
Amid increasing commodity prices like coal and iron ore, investors preferred buying the Australian dollar over other majors, helping the Aussie rebound against the greenback and other majors, affected by Chinese GDP and consumer prices which showed strong economic growth in the first quarter.
Australian iron ore and coal exports will accelerate in the upcoming period amid global economic recovery. The demand for Australian currency to strengthen as the nation produces about 20% of the world’s iron ore, which climbed 4.3%, while coal-export prices jumped 25%.
On the other hand, the Australian currency will increase against the US dollar and other major, on expectations the RBA will shift to a tightening stance soon. Furthermore, the China’s demand for Australian raw materials (which accounts for 60% of Australian products) will increase in the upcoming period.
Nonetheless, aussie might continue to soften for now amid the fragile state of sentiment in the market and following the Chinese move to raise reserve requirements which will dent risk demand on fears over the outlook amid lingering European debt woes that are already weighing on the market.
On Tuesday, the Australian economy will release its first set of fundamentals with the Reserve Bank of Australia minutes for the month of April at 01:30 GMT, which has a strong impact on the market, where indications for a hold on rates for now from the RBA will send aussie down violently and an indication of a move soon and fear of inflation will trigger new records.
On Tuesday, at 12:30 GMT, U.S. economy will release building permits March, and expected to come at 540 thousand rising from the previous 517 thousand. The housing starts for March is expected to have increase to 520 thousand following 479 thousand which will support ease risk aversion on the data and likely support aussie slightly against the dollar.Â
Originally posted here
Read more about forex technical analysis, forex fundamental analysis and forex news on ForexMansion.com
About ForexMansion.com:
www.ForexMansion.com is a part of the Finance Mansion Network which operates global financial websites. Our goal is to provide our readers with the most accurate, quality and up-to-date technical analysis, fundamental analysis and news in order to assist them in making the right financial decisions.
The Finance Mansion Network includes www.FinanceMansion.com,www.ForexMansion.com, www.StocksMansion.com, www.CommoditiesMansion and many more.
