Investing.com - The Australian dollar plunged to a more than four-year low against its U.S. counterpart on Friday, as stronger than forecast U.S. nonfarm payrolls data bolstered bets that the Federal Reserve will begin to raise rates sooner than previously thought.
AUD/USD hit a daily low of 0.8643 on Friday, a level not seen since July 2010, before subsequently consolidating at 0.8676 by close of trade, down 1.43% for the day and 1.03% lower for the week.
The pair is likely to find support at 0.8632, the low from July 19, 2010, and resistance at 0.8748, the high from October 1.
In a report, the Department of Labor said that the U.S. economy added 248,000 jobs in September, well ahead of forecast for jobs growth of 215,000. The unemployment rate ticked down from 6.0% to 5.9%, the lowest level since July 2008.
The upbeat data added to the view that the strengthening economic recovery may prompt the Federal Reserve to raise interest rates sooner than markets are expecting.
The US Dollar Index, which tracks the performance of the greenback against a basket of six major currencies, was up 1.23% to 86.79 in late trade, a high last seen in June 2010, capping its twelfth consecutive weekly gain. The twelve-week rally is the longest since the index was created in 1971.
Meanwhile, in Australia, official data released earlier in the week showed that retail sales rose 0.1% in August, disappointing expectations for a 0.4% gain.
The weak data fuelled concerns over the outlook for economic growth in the third quarter.
Data from the Commodities Futures Trading Commission released Friday showed that speculators turned bearish on the Australian dollar in the week ending September 30.
Net shorts totaled 2,017 contracts, compared to net longs of 8,347 in the preceding week.
In the coming week, investors will be looking ahead to Wednesday’s Federal Reserve meeting minutes for further indications on the future possible direction of U.S. monetary policy.
A monetary policy decision by the Reserve Bank of Australia will also be in focus.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.
Tuesday, October 7
The RBA is to announce its benchmark interest rate and publish its rate statement.
Wednesday, October 8
In the U.S., the Federal Reserve is to publish the minutes of its latest policy setting meeting.
Thursday, October 9
Australia is to release data on the change in the number of people unemployed and the unemployment rate.
The U.S. is to publish its weekly government report on initial jobless claims.
Friday, October 10
Australia is to release a report on home loans.
The U.S. is to round up the week with data on import prices.