**AUD/USD Weekly Forecast: Choppy Action Around 0.6500 As Mixed Australian-US Data Triggers Sideways Trading**
*Original insights by Yohay Elam, Forex Crunch. Expanded with supplementary market analysis and current outlooks.*
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### Introduction
The AUD/USD currency pair exhibited a sideways trading pattern last week, fluctuating near the 0.6500 level as both Australian and US economic indicators produced mixed signals. Analyzing recent price movements, economic data releases, and changing market sentiment, traders are seeking clarity on the medium-term outlook for the Australian Dollar against its US counterpart.
This in-depth forecast, rooted in Yohay Elam’s original analysis from Forex Crunch and supplemented by additional research, examines the forces driving the pair, highlights the latest macroeconomic developments, and explores the technical landscape. The article concludes with strategic recommendations and a broader perspective on what lies ahead for AUD/USD.
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### Key Economic Developments and Impact
#### Australian Data: Signs of Fragility and Subdued Confidence
– **Retail Sales:** The latest figures revealed a slower-than-expected increase in Australian retail sales. Weak consumer spending, which is a critical driver of Australia’s GDP, suggests households remain cautious amid persistent cost-of-living pressures and high borrowing costs.
– **Trade Surplus:** Australia’s trade balance improved slightly, but a decline in commodity prices, especially iron ore and coal, weighed on export revenues. Given that commodities form the backbone of Australia’s foreign earnings, any sustained softness holds downside risks for the Australian Dollar.
– **Consumer Confidence:** Australian consumer sentiment remained tepid, reinforcing the notion that the Reserve Bank of Australia’s (RBA) restrictive monetary policy stance is having a dampening effect on domestic demand.
#### US Data: Mixed Economic Cues Stir the Greenback
– **Non-Farm Payrolls (NFP):** The latest jobs report overshot expectations, reigniting hawkish speculation around Federal Reserve (Fed) policy, which initially boosted the US Dollar.
– **ISM Manufacturing and Services:** Leading indicators such as the ISM surveys sent conflicting messages, with manufacturing remaining under pressure while the services sector continued to defy contractionary trends.
– **Inflation Metrics:** Core inflation readings have cooled but remain above the Fed’s target, complicating the outlook for short-term interest rate changes.
#### Central Bank Rhetoric: A Balancing Act
– **RBA Outlook:** The RBA left rates unchanged, reiterating a data-dependent approach. The central bank signaled no rush to cut rates, citing the still-elevated inflation and ongoing geopolitical uncertainties.
– **Fed Commentary:** The Fed’s communication has vacillated between confidence in a disinflationary process and a lack of urgency in slashing rates. The tone has edged slightly dovish, with policymakers mindful of not stifling economic momentum.
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### AUD/USD Price Action: A Technically Trapped Currency Pair
#### Recent Performance Review
Over the past week, AUD/USD has
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