Investing.com - The Australian dollar gained ground against its U.S. counterpart on Friday, trimming a weekly loss, amid speculation that the Federal Reserve will hold off on scaling back monetary stimulus.
AUD/USD hit 0.9386 on Thursday, the pair’s highest since November 11; the pair subsequently consolidated at 0.9372 by close of trade on Friday, up 0.61% on the day but 0.1% lower for the week.
The pair is likely to find support at 0.9281, the low from November 14 and resistance at 0.9480, the high from November 8.
Hopes of continued stimulus from the Federal Reserve mounted after a report showed that the Fed’s Empire state manufacturing index fell to -2.21 from 1.52 in October. Economists had forecast a rise to 5.0.
A separate report showed that U.S. industrial production fell 0.1% in October, after rising by 0.7% in September, compared to expectations for a 0.2% increase.
The data came a day after testimony from Fed Vice Chairwoman Janet Yellen was seen as cementing the view that the bank will keep its USD85 billion-a-month asset purchase program in place until early next year.
Ms. Yellen said it was "imperative" that the Fed does everything in its power to ensure a robust recovery. She said the quantitative easing program would not continue indefinitely but the timescale for reducing it would be data dependent.
The comments came during a Senate confirmation hearing to take over from Ben Bernanke as head of the central bank in February.
In the week ahead, investors will be closely watching Wednesday’s minutes of the Fed’s most recent policy setting meeting. The U.S. is also to release data on retail sales and consumer prices.
Meanwhile, the Reserve Bank of Australia will release the minutes of its most-recent policy-setting meeting, when the central bank left rates unchanged at 2.5% and said a weaker currency will be needed to support growth.
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 are no relevant events on this day.
Monday, November 18
The U.S. is to release private sector data on the outlook for the housing sector.
Tuesday, November 19
The Reserve Bank of Australia is to publish its monetary policy meeting minutes, which contain valuable insights into economic conditions from the bank’s perspective. Australia is also to publish an index of leading economic indicators.
The U.S. is to release data on the employment cost index, an important inflationary indicator.
Wednesday, November 20
The U.S. is to release a series of data including a report on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity. The nation is also to publish data on consumer inflation, existing home sales and business inventories.
Later Wednesday, the Federal Reserve is to publish what will be the closely watched minutes of its latest policy meeting.
Thursday, November 21
China is to release the preliminary estimate of the HSBC manufacturing index, a leading indicator of economic health. China is Australia’s largest export partner.
The U.S. is release data on producer price inflation, as well as the weekly report on initial jobless claims. The U.S. is also to release data manufacturing activity from the Philly Fed.
AUD/USD hit 0.9386 on Thursday, the pair’s highest since November 11; the pair subsequently consolidated at 0.9372 by close of trade on Friday, up 0.61% on the day but 0.1% lower for the week.
The pair is likely to find support at 0.9281, the low from November 14 and resistance at 0.9480, the high from November 8.
Hopes of continued stimulus from the Federal Reserve mounted after a report showed that the Fed’s Empire state manufacturing index fell to -2.21 from 1.52 in October. Economists had forecast a rise to 5.0.
A separate report showed that U.S. industrial production fell 0.1% in October, after rising by 0.7% in September, compared to expectations for a 0.2% increase.
The data came a day after testimony from Fed Vice Chairwoman Janet Yellen was seen as cementing the view that the bank will keep its USD85 billion-a-month asset purchase program in place until early next year.
Ms. Yellen said it was "imperative" that the Fed does everything in its power to ensure a robust recovery. She said the quantitative easing program would not continue indefinitely but the timescale for reducing it would be data dependent.
The comments came during a Senate confirmation hearing to take over from Ben Bernanke as head of the central bank in February.
In the week ahead, investors will be closely watching Wednesday’s minutes of the Fed’s most recent policy setting meeting. The U.S. is also to release data on retail sales and consumer prices.
Meanwhile, the Reserve Bank of Australia will release the minutes of its most-recent policy-setting meeting, when the central bank left rates unchanged at 2.5% and said a weaker currency will be needed to support growth.
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 are no relevant events on this day.
Monday, November 18
The U.S. is to release private sector data on the outlook for the housing sector.
Tuesday, November 19
The Reserve Bank of Australia is to publish its monetary policy meeting minutes, which contain valuable insights into economic conditions from the bank’s perspective. Australia is also to publish an index of leading economic indicators.
The U.S. is to release data on the employment cost index, an important inflationary indicator.
Wednesday, November 20
The U.S. is to release a series of data including a report on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity. The nation is also to publish data on consumer inflation, existing home sales and business inventories.
Later Wednesday, the Federal Reserve is to publish what will be the closely watched minutes of its latest policy meeting.
Thursday, November 21
China is to release the preliminary estimate of the HSBC manufacturing index, a leading indicator of economic health. China is Australia’s largest export partner.
The U.S. is release data on producer price inflation, as well as the weekly report on initial jobless claims. The U.S. is also to release data manufacturing activity from the Philly Fed.