In the Asian session on Wednesday (December 7), AUD/USD rose slightly, temporarily reporting 0.6710, an increase of 0.35%. National Australia Bank raised its forecast for Australia’s GDP growth in the third quarter, arguing that net exports would be less of a drag on the economy than previously expected. Economist Taylor Nugent expects the Australian economy to grow by 0.8% in the third quarter, up from a previous forecast of 0.6%.
The latest news from the Commonwealth of Australia:
The RBA’s reiteration that there is no set path for rate hikes appears to be an attempt to prevent market sentiment from shifting toward expectations of a smaller or no rate hike at the next policy meeting, flag economists said. Citi still expects the RBA to raise rates for a fourth time by 25 basis points when it meets in February next year, taking rates to a peak of 3.35 per cent. However, Citi also admitted that the Reserve Bank of Australia may raise interest rates to 3.60%.
AUD/USD technical analysis:
AUD/USD justified weaker-than-expected Australian GDP data, retreating from intraday highs near 0.6700 after the data was released on Wednesday morning. The Aussie is struggling to justify cautious optimism in markets, largely supported by catalysts around China and the Federal Reserve.