Economists note increased inflationary pressures in the Australian economy, which could force the Reserve Bank of Australia to tighten policy more aggressively. According to their forecast, in the 3rd quarter, the annual inflation rate in Australia will exceed 7%, which could force the RBA to raise the key rate to 2.75% by the beginning of next year, despite the weakening of economic activity and lower house prices. Thus, the likelihood of a repeated increase in the RBA rate by 50 basis points has increased, and this is a positive factor for the Australian currency.
This week, a number of important macro statistics for Australia and the United States are expected to be published, which will be directly reflected in the AUD/USD dynamics (for more details, see "The most important economic events of the week 05/30/2022 - 06/05/2022"). However, the focus of market participants this week will be the publication on Friday (at 12:30 GMT) of the monthly report of the US Department of Labor with data on the country's labor market for May.
Thus, in the absence of negative news from Australia and the negative dynamics of the US dollar, the pair AUD/USD has every chance to come close to the above marks of 0.7240, 0.7270 by Friday (for more details, see "AUD/USD: technical analysis and trading recommendations on May 30, 2022").
Support levels: 0.7165, 0.7128, 0.7085, 0.7064, 0.7037, 0.7000, 0.6970, 0.6800, 0.6450
Resistance levels: 0.7200, 0.7240, 0.7270, 0.7310, 0.7400, 0.7440, 0.7510, 0.7555, 0.7600, 0.7650
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Source: InstaForex
