Forex - AUD/USD weekly outlook: March 16 - 20

Investing.com - The Australian dollar ended Friday's session close to a six-year low against its U.S. counterpart, as expectations that the Federal Reserve will start raising interest rates as early as June boosted the greenback.

AUD/USD hit 0.7559 on Wednesday, the pair's lowest since May 2009, before subsequently consolidating at 0.7635 by close of trade on Friday, down 0.94% for the day and 1.05% lower for the week.

Demand for the U.S. dollar continued to be underpinned after stronger-than-forecast nonfarm payrolls report for February released earlier in the month solidified expectations for higher interest rates.

The Federal Reserve is expected to begin raising interest rates around the middle of this year and investors were looking ahead to next week’s policy statement to see if it would drop its reference to being "patient" before raising rates.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, jumped 1.2% on Friday to end at 100.32, after touching an intraday high of 100.39, the most since April 2003.

Meanwhile, the Australian Bureau of Statistics said Thursday that the number of employed people rose by 15,600 in February, beating expectations for an increase of 15,000.

The report also showed that Australia's unemployment rate ticked down to 6.3% last month from 6.4% in January, in line with expectations.

Elsewhere, the euro fell below the $1.05-level against the greenback for the first time in 12 years, pressured lower by the diverging monetary policy stance between the Federal Reserve and the European Central Bank.

The euro has depreciated more than 10% against its U.S. counterpart for the year and nearly 40% since August as the ECB launched a €60 billion a month quantitative easing program earlier in March.

In the week ahead, market players will focus on the conclusion of the Federal Reserve's two-day monetary policy meeting on Wednesday, which could provide indications on how soon it might raise interest rates.

If the Fed decides to remove a reference to "remaining patient," in its statement, it typically indicates that interest rates could be raised at either of its next two meetings. After next week's meeting, the FOMC will meet in June and September.

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 Friday as there is no relevant data on this day.

Monday, March 16

The U.S. is to produce reports on industrial production and manufacturing activity in the New York region, as well as private sector data on the housing market.

Tuesday, March 17

The Reserve Bank of Australia is to publish the minutes of its latest policy meeting, giving investors insight into how officials view the economy and their policy options.

The U.S. is to report on building permits and housing starts.

Wednesday, March 18

The Fed is to announce its federal funds rate and publish its rate statement, which outlines economic projection and the factors affecting the monetary policy decision.

Fed Chair Janet Yellen is to hold what will be a closely watched a post-policy meeting press conference.

Thursday, March 19

The U.S. is to release reports on jobless claims, the current account and manufacturing activity in the Philadelphia region.