03.06.202112:21 Forex Analysis & Reviews: AUD/USD: Does the Australian dollar need help to see further paths?

The Australian dollar remains relatively calm, being in the existing price range. However, experts warn traders against being too relaxed, believing that the currency can change direction at any time.

During the current week, the Australian dollar experienced a slight volatility. On Wednesday, June 2, the Australian dollar sank slightly, despite the positive macro statistics received from Australia. According to a report from the Australian Bureau of Statistics (ABS), in the first quarter of 2021, the country's GDP increased by 1.8%, and on an annualized basis – by 1.1%.

The current situation has had a positive impact on the dynamics of the Australian dollar. On the morning of Thursday, June 3, the AUD/USD pair was trading near 0.7724, trying to get higher. According to analysts, since the beginning of this year, the tandem has remained in a wide range – from 0.7600 to 0.7835. Over the past three weeks, it has narrowed to 0.7680 and 0.7815. According to experts, the AUD/USD pair lacks strong drivers for a further breakthrough. In the event of their appearance, the scale of the tandem can tilt either downward or go up.

On Tuesday, June 1, at the meeting, the Reserve Bank of Australia (RBA) kept the key rate unchanged. At the same time, the yield level of 3-year government bonds remained at a record low of 0.10%. The regulator will keep the interest rate at the current level until real inflation is fixed in the range of 2%-3%. According to economists, this will happen no earlier than 2024.

Some experts believe that in the next six months, the RBA will reduce the asset purchase program by 50 billion Australian dollars. Note that now the monthly volume of purchases is 100 billion Australian dollars. According to economists, this indicates the beginning of the curtailment of the stimulating policy of the monetary authorities. In the event of a reduction in the volume of asset purchases by the RBA, the national economy is expected to reduce the volume of liquidity and strengthen the Australian currency.

According to experts' calculations, positive data on the trade balance and retail sales volume can briefly raise the AUD volatility. According to forecasts, in April 2021, a trade surplus of 7.900 billion Australian dollars is expected. Note that the increase in the surplus is a positive factor for the currency. As for the volume of retail sales, a key indicator of consumer confidence in the country, its value is projected in the same range (1.1%). After the publication of Australia's macroeconomic data, the AUD may strengthen, but this strengthening will be short-term.

In the first quarter of 2021, the Australian economy recovered at a rapid pace. By now, the country's output has reached the level of 2020, almost returning to pre-crisis levels. The current rise in the indicator is due to the flow of private investment (they increased by 0.9 percentage points). The strongest quarterly growth in the past 12 years was recorded in investment in machinery and equipment, as well as in the housing sector. Experts expect that consumer demand in Australia will remain at a high level. This is supported by positive reports on retail sales, employment and construction activity, as well as an increase in consumer lending.

In the current situation, experts do not record negative impulses that can turn the dynamics of the Australian dollar. However, unpredictable phenomena can occur covertly, which makes it difficult to predict the further movement of the AUD/USD pair. Nevertheless, analysts are optimistic, believing that the currency will be able to bypass the price holes.