AUD/USD: Australia’s services sector contracted in February


AUDUSD Movement

For the 24 hours to 23:00 GMT, the AUD declined 1.43% against the USD and closed at 0.7570, after data indicated that Australia’s service sector activity contracted in February, thus casting doubt over the health of the nation’s economy.

Australia’s AIG performance of services index eased to a level of 49.0 in February, entering into the contraction territory, compared to a reading of 54.5 in the prior month.

LME Copper prices declined 0.8% or $46.0/MT to $5994.0/MT. Aluminium prices declined 0.3% or $5.0/MT to $1929.0/MT.

In the Asian session, at GMT0400, the pair is trading at 0.7559, with the AUD trading 0.15% lower against the USD from yesterday’s close.

Early morning data revealed that in China, Australia’s largest trading partner, the Caixin/Markit services PMI eased to a level of 52.6 in February, hitting its lowest level in 4 months and compared to a level of 53.1 in the previous month.

The pair is expected to find support at 0.7512, and a fall through could take it to the next support level of 0.7465. The pair is expected to find its first resistance at 0.7634, and a rise through could take it to the next resistance level of 0.7709.

Next week, investors will closely monitor the Reserve Bank of Australia’s (RBA) interest rate decision.

The currency pair is trading below its 20 Hr and 50 Hr moving averages.

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