**FxWirePro Analysis: AUD/USD Rises as Weak US Data Pressures the Dollar**
*Based on original reporting by EconoTimes; content expanded and supplemented with additional insights from FXStreet, Reuters, and Investing.com.*
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### Introduction
The Australian dollar (AUD) has recently shown notable strength against the US dollar (USD), with the AUD/USD currency pair climbing higher in the wake of disappointing economic data from the United States. This development has drawn the attention of forex market participants, analysts, and traders worldwide. The following article examines the current performance of the AUD/USD, investigates the economic factors influencing movement, provides expert analysis, explores market sentiment, and considers the potential future trajectory of the currency pair.
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### Recent Performance of AUD/USD
– **Recent Gains:** Over the past several trading sessions, AUD/USD has posted steady gains. As of the most recent update, the pair was trading above 0.6600, recording a daily rise of approximately 0.4 percent.
– **Intraday Volatility:** The pair opened higher in Asia and extended advances through the European and US sessions, supported by selling pressure on the greenback.
– **Trading Range:** Earlier in the week, AUD/USD fluctuated in a narrow range before gaining momentum due to broader US dollar weakness.
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### Impact of Weak US Economic Data
The primary catalyst behind the recent AUD/USD strength is a string of weaker-than-anticipated US economic reports.
#### Key Data Releases Influencing Sentiment
– **US Manufacturing Data:** The Institute for Supply Management (ISM) reported a lower-than-expected reading on its manufacturing PMI, signaling potential slowdown in US manufacturing activity.
– **US Employment Figures:** The US Labor Department’s non-farm payrolls data fell short of forecasts, indicating softer job creation and raising concerns about the sustainability of the US economic recovery.
– **US Inflation Numbers:** Recent consumer price index (CPI) releases showed inflation increasing at a slower pace, diminishing expectations for further aggressive monetary tightening by the Federal Reserve.
– **Consumer Confidence:** Consumer sentiment, as reflected in the University of Michigan’s Index, declined, further weighing on the prospects for domestic consumption.
#### Market Reaction
Investors responded to the disappointing US data by:
– Reducing expectations for near-term interest rate hikes from the Federal Reserve
– Selling the US dollar as investors sought higher-yielding and growth-sensitive assets
– Increasing demand for riskier currencies, including the Australian dollar
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### Australian Economic Context
While the US economy shows signs of cooling, Australia offers a relatively stable economic backdrop that has helped support the AUD.
#### Recent Australian Data and Policy
– **Retail Sales:** Australia’s retail sales have posted modest increases, reflecting steady domestic consumption.
– **Labour Market:** The unemployment rate remains low, indicating continued labor market strength.
– **Reserve Bank of Australia (RBA) Policy:** The RBA has signalled a data-dependent approach, keeping the cash rate steady at recent meetings but
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