AUD/USD inches higher toward 0.6700 despite broad USD strength
- Retail Sales in Australia rose more than expected in November.
- US Dollar Index clings to gains above 97.50.
- Coming up: December Nonfarm Payrolls data from US.
After closing the last seven trading days in the negative territory, the AUD/USD pair gained traction during the Asian trading hours on Friday and started to climb toward the 0.6700 handle. As of writing, the pair is up 0.33% on the day at 0.6880.
Upbeat data supports AUD on Friday
The data published by the Australian Bureau of Statistics on Friday showed that Retail Sales in November rose 0.9% on a monthly basis after staying unchanged in October to beat the market expectation for an increase of 0.4% and helped the AUD gather strength.
In the meantime, although some analysts think that the Australian bushfires' damage to the economy could force the Reserve Bank of Australia to consider a rate cut, “it is indeed clear that the RBA appears to be in a holding pattern as it waits to gauge the effects of the rate cuts so far this year," argued Global Economics & Markets Research at UOB Group. "We are thus maintaining our OCR call of 0.75%, for now."
On the other hand, the US Dollar Index, which registered gains in the last three days, is stretching higher on Friday ahead of the US Bureau of Labor Statistics' closely-watched Nonfarm Payrolls (NFP) report. Markets expect the NFP to ease to 164K in December from 266K in November. Participants will also be paying attention to the Average Hourly Earnings data.
US NFP Preview: 8 Major Banks expectations from December payrolls report
Technical levels to watch for