- September witnessed a remarkable surge in Australian retail sales.
- The likelihood of an RBA hike in November has risen to 61%.
- Israeli troops, supported by tanks, initiated a ground assault in Gaza.
The AUD/USD forecast shines with optimism as September saw a remarkable surge in Australian retail sales, marking the quickest growth in eight months. It indicates a notable resilience in consumer spending. Consequently, it strengthens the case for a potential interest rate hike as early as next week.
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At the moment, markets expect that the Reserve Bank of Australia will implement a quarter-point rate hike in November. The probability rose to 61%, up from 58%.
Notably, nominal retail sales in September increased by 0.9% compared to August. It exceeded analysts’ expectations for a 0.3% increase and was an upward revision of the 0.3% gain in August. Moreover, this positive trend bodes well for economic growth.
Taylor Nugent, a markets economist at National Australia Bank, stated, “For the RBA, we don’t believe the November decision will hinge on a single monthly retail figure. However, today’s data provides yet another piece of evidence that consumers remain resilient.”
Meanwhile, investors remained cautious as Palestinians in northern Gaza reported intense air and artillery strikes on Monday. Israeli troops, supported by tanks, initiated a ground assault in the area, increasing tensions. Consequently, there are increased international calls for the protection of civilians.
Additionally, Chris Weston, head of research at Pepperstone, noted, “The geopolitical backdrop in the Middle East continues to be a major factor influencing the market.”
AUD/USD key events today
Traders will keep absorbing recent data as no major events will come from Australia or the US.
AUD/USD technical forecast: Bulls break through the 0.6350 barrier.
On the technical side, AUD/USD is crossing above the 0.6350 key level. This move comes after the price found support at the 30-SMA, showing the start of a bullish trend. At the same time, the RSI found support at the pivotal 50 level before bouncing higher into bullish territory.
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However, Aussie has been moving sideways on a larger scale. The price has mostly kept between the 0.6300 support and the 0.6400 resistance. If the price detaches from the 0.6350 key level, bulls will target the next resistance at 0.6400. Moreover, a break above this level would mean a breakout from the larger consolidation.
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