**AUD/USD Forecast: Australian Dollar Faces Pressure Amid Shifting Market Dynamics**
*Based on original analysis by FXStreet team, integrated with broader insights on the AUD/USD pair as of June 2024*
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### Introduction
The Australian Dollar to US Dollar (AUD/USD) currency pair, often referred to as the “Aussie,” is a widely traded pairing in the forex market. As a commodity currency, the “Aussie” is sensitive to global risk sentiment, commodity price movements, and the outlook for both the Australian and US economies. In June 2024, the pair faces substantial headwinds, with a mix of technical and fundamental drivers shaping its outlook.
Drawing from FXStreet’s latest analysis and supported through further research from Bloomberg and Reuters, this article provides a comprehensive outlook for the AUD/USD, highlighting key drivers, recent price behavior, technical patterns, and upcoming risks for traders and investors.
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### AUD/USD Overview: Recent Performance and Context
Since early 2024, the AUD/USD has encountered sustained downward pressure. The pair is reacting to:
– Divergent central bank policies between the US Federal Reserve and the Reserve Bank of Australia (RBA)
– Shifts in risk appetite tied to global macroeconomic data
– Changes in commodity prices, particularly iron ore and coal
– Overall US dollar strength amid safe haven demand
#### Recent Price Action
– As of mid-June 2024, AUD/USD is hovering close to multi-month lows, trading within a range of 0.6580 to 0.6670.
– The currency pair has failed multiple attempts to break and sustain above the 0.6700 psychological resistance.
– Weak performance in the Australian labor market and muted inflation have increased speculation that the RBA may delay future rate hikes.
– At the same time, robust US economic data has pushed back expectations of Federal Reserve rate cuts, supporting the US dollar.
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### Fundamental Drivers Shaping AUD/USD
#### 1. Diverging Central Bank Policy
– **US Federal Reserve**:
– While there had been speculation about potential Fed rate cuts in the latter half of 2024, persistent inflation and resilient employment data have kept the Fed cautious.
– The FOMC has maintained a wait-and-see stance, repeatedly indicating that they need conclusive evidence of slowing inflation before easing policy.
– This perceived higher-for-longer stance has lent strength to the US dollar across the board.
– **Reserve Bank of Australia**:
– The RBA faces a more nuanced picture, with inflation having eased but concerns persisting regarding terms-of-trade and household spending.
– Mixed domestic data, such as sluggish job growth and low consumer confidence, have fueled a less hawkish policy outlook.
– Markets now expect the RBA to remain on hold into 2025, with the potential for rate cuts if growth continues to disappoint.
#### 2. US Dollar Strength
– The US dollar index (DXY) has
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