Investing.com - The Australian dollar rose against its U.S. counterpart on Friday, trimming some of the week’s losses as concerns over a slowdown in China and in the euro zone temporarily eased, supporting demand for riskier assets.
AUD/USD hit 1.0335 on Thursday, the pair’s lowest since January 17; the pair subsequently consolidated at 1.0458 by close of trade on Friday, retreating 1.24% over the week.
The pair was likely to find support at 1.0301, the low of January 17 and resistance at 1.0560, the high of March 13.
Sentiment improved on Friday after euro zone finance ministers said they are moving closer to agreeing on a combined rescue fund of around EUR700 billion next week.
Meanwhile, the U.S. dollar weakened after the U.S. Commerce Department said new home sales dropped 1.6% to a 313,000 annual pace, the slowest since October, from a 318,000 annual rate in January and against expectations for an increase to 325,000.
However, the greenback remained supported after the Federal Reserve upgraded its view on the economy earlier this month, leading investors to trim back expectations for a third round of monetary easing from the central bank.
The U.S. outlook was also boosted by data Thursday showing that jobless claims fell to the lowest level since February 2008 last week.
The Department of Labor said the number of individuals filing for initial jobless benefits in the week ending March 17 fell by 5,000 to a seasonally adjusted 348,000, beating expectations for a decline of 3,000 to 350,000.
The previous week’s figure was revised up to 353,000 from 351,000.
Demand for the risk-related Aussie was hit on Thursday after preliminary data from HSBC showed that China’s manufacturing purchasing managers’ index fell to 48.1 in March, from a final reading of 49.6 the previous month, as new orders dropped to their lowest level since November.
The data underlined concerns over a possible slowdown in growth in the world’s second largest economy.
The Aussie tumbled over 1% against the U.S. dollar on Tuesday after the minutes of the Reserve Bank of Australia’s March policy meeting pointed to the possibility of more rate cuts in the coming months.
The RBA said that said that in the event of a sharp slowdown in the domestic economy due to risks arising from the debt crisis in the euro zone there was "ample scope" to cut interest rates if required.
Sentiment on the Australian dollar was also hit after the country’s largest miner BHP Billiton said Chinese demand for iron ore was "flattening out." China is Australia’s largest trading partner.
In the week ahead, market participants will be looking ahead to Friday’s meeting of euro zone finance ministers to discuss the lending capacity of the region’s permanent bailout fund, the European Financial Stability Facility.
Meanwhile, the U.S. is to release data on consumer confidence, pending homes sales, and factory output, all of which will be closely watched in order to gauge the strength of the U.S. economic recovery.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 26
Federal Reserve Chairman Ben Bernanke is scheduled to speak at the National Association for Business Economists 2012 Policy Conference. The U.S. is also to publish industry data on pending home sales, a key gauge of economic health.
Tuesday, March 27
The U.S. is to produce a Standard & Poor’s/Case Shiller composite-20 house price inflation report, as well as industry data on consumer confidence.
Later in the day, Fed Chairman Bernanke is due to deliver the third part of a lecture titled "The Federal Reserve and its Role in Today's Economy" at the George Washington University School of Business, in Washington.
Wednesday, March 28
The RBA is to publish a financial stability review, which is an assessment of conditions in the financial system and potential risks to financial stability.
The U.S. is to publish government data on durable goods orders, a leading indicator of production, followed by a report on crude oil stockpiles.
Thursday, March 29
The U.S. is to publish government data on unemployment claims, a key signal of overall economic health, as well as final data on fourth quarter GDP. Fed Chairman Bernanke is also due to speak.
Friday, March 30
Australia is to release industry data on new home sales, while the RBA is to publish a report on private sector credit.
The U.S. is to round up the week with government data on personal consumption expenditures and personal spending as well as industry data on the purchasing managers’ index in Chicago. In addition, the University of Michigan is to release revised data on consumer sentiment.
AUD/USD hit 1.0335 on Thursday, the pair’s lowest since January 17; the pair subsequently consolidated at 1.0458 by close of trade on Friday, retreating 1.24% over the week.
The pair was likely to find support at 1.0301, the low of January 17 and resistance at 1.0560, the high of March 13.
Sentiment improved on Friday after euro zone finance ministers said they are moving closer to agreeing on a combined rescue fund of around EUR700 billion next week.
Meanwhile, the U.S. dollar weakened after the U.S. Commerce Department said new home sales dropped 1.6% to a 313,000 annual pace, the slowest since October, from a 318,000 annual rate in January and against expectations for an increase to 325,000.
However, the greenback remained supported after the Federal Reserve upgraded its view on the economy earlier this month, leading investors to trim back expectations for a third round of monetary easing from the central bank.
The U.S. outlook was also boosted by data Thursday showing that jobless claims fell to the lowest level since February 2008 last week.
The Department of Labor said the number of individuals filing for initial jobless benefits in the week ending March 17 fell by 5,000 to a seasonally adjusted 348,000, beating expectations for a decline of 3,000 to 350,000.
The previous week’s figure was revised up to 353,000 from 351,000.
Demand for the risk-related Aussie was hit on Thursday after preliminary data from HSBC showed that China’s manufacturing purchasing managers’ index fell to 48.1 in March, from a final reading of 49.6 the previous month, as new orders dropped to their lowest level since November.
The data underlined concerns over a possible slowdown in growth in the world’s second largest economy.
The Aussie tumbled over 1% against the U.S. dollar on Tuesday after the minutes of the Reserve Bank of Australia’s March policy meeting pointed to the possibility of more rate cuts in the coming months.
The RBA said that said that in the event of a sharp slowdown in the domestic economy due to risks arising from the debt crisis in the euro zone there was "ample scope" to cut interest rates if required.
Sentiment on the Australian dollar was also hit after the country’s largest miner BHP Billiton said Chinese demand for iron ore was "flattening out." China is Australia’s largest trading partner.
In the week ahead, market participants will be looking ahead to Friday’s meeting of euro zone finance ministers to discuss the lending capacity of the region’s permanent bailout fund, the European Financial Stability Facility.
Meanwhile, the U.S. is to release data on consumer confidence, pending homes sales, and factory output, all of which will be closely watched in order to gauge the strength of the U.S. economic recovery.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 26
Federal Reserve Chairman Ben Bernanke is scheduled to speak at the National Association for Business Economists 2012 Policy Conference. The U.S. is also to publish industry data on pending home sales, a key gauge of economic health.
Tuesday, March 27
The U.S. is to produce a Standard & Poor’s/Case Shiller composite-20 house price inflation report, as well as industry data on consumer confidence.
Later in the day, Fed Chairman Bernanke is due to deliver the third part of a lecture titled "The Federal Reserve and its Role in Today's Economy" at the George Washington University School of Business, in Washington.
Wednesday, March 28
The RBA is to publish a financial stability review, which is an assessment of conditions in the financial system and potential risks to financial stability.
The U.S. is to publish government data on durable goods orders, a leading indicator of production, followed by a report on crude oil stockpiles.
Thursday, March 29
The U.S. is to publish government data on unemployment claims, a key signal of overall economic health, as well as final data on fourth quarter GDP. Fed Chairman Bernanke is also due to speak.
Friday, March 30
Australia is to release industry data on new home sales, while the RBA is to publish a report on private sector credit.
The U.S. is to round up the week with government data on personal consumption expenditures and personal spending as well as industry data on the purchasing managers’ index in Chicago. In addition, the University of Michigan is to release revised data on consumer sentiment.