The AUD/USD pair fluctuates near 0.6200 as market participants await key economic indicators, including the US ISM Manufacturing PMI and Australia's monthly CPI.
AUD/USD trades around 0.6200 as investors await the US ISM Manufacturing PMI data. The Fed has signaled fewer interest rate cuts for this year. The RBA needs to be confident about declining inflation before considering rate cuts. The AUD/USD pair consolidates around 0.6200 in Friday’s North American session. The Aussie pair is consolidating as investors await the United States (US) ISM Manufacturing Purchasing Managers’ Index (PMI) data for December, which will be published at 15:00 GMT.
Economists expect the Manufacturing PMI to have remained unchanged at 48.4, suggesting that activities contracted at a steady pace. Signs of weakness in factory activities would boost expectations that the Federal Reserve (Fed) will follow a “slower and cautious” interest rate cut approach this year. In the latest dot plot, the Fed signaled fewer interest rate cuts this year as policymakers were upbeat over the US economic outlook. For the upcoming policy meeting on January 29, the Fed is expected to leave interest rates unchanged in the range of 4.25%-4.50%, according to the CME FedWatch tool. Ahead of the US ISM Manufacturing PMI data, the US Dollar (USD) drops slightly. Still, it is close to an over two-year high, with the US Dollar Index (DXY) trading around 109.00. Meanwhile, the Australian Dollar (AUD) trades sideways as investors await monthly Consumer Price Index (CPI) data for November, which will be released on Wednesday. The monthly CPI is estimated to have grown by 2.3%, faster than the former release of 2.1%. Signs of accelerating price pressures would force the Reserve Bank of Australia (RBA) to delay plans of pivoting to interest rate cuts. RBA Governor Michele Bullock said on December 10 that the central bank doesn’t need to see inflation returning in the desired range to start reducing its Official Cash Rate (OCR)
AUD/USD US ISM Manufacturing PMI Australian CPI Federal Reserve Reserve Bank Of Australia
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