Also scheduled for June 2, Aussie job ad data will influence sentiment toward the labor market and AUD/USD trends. Economists forecast ANZ-Indeed job ads to rise 0.4% in May after increasing 0.5% in April.
A higher reading would signal a tightening labor market and rising wages. Higher wages could boost household spending and inflation. Rising inflation could temper bets on multiple RBA rate cuts, sending AUD/USD toward $0.65. Conversely, a lower print may indicate weakening labor market conditions, potentially dampening consumer spending and inflationary pressures. A more dovish RBA stance could push the pair below $0.64 toward the $0.63623 support level.
Recent retail sales figures have raised concerns about the consumption component of the Aussie economy. Shane Oliver, Head of Investment Strategy and Chief Economist at AMP, remarked on retail sales, stating:
“Aust real retail sales per person has trended down this year and is back to around where it was a year ago after a very mild rising trend into late last year. The ‘cost of living’ remains a problem (falling inflation is not the same as falling prices!).”
Aussie Dollar Daily Outlook: US ISM Manufacturing PMI and the Fed Rate Path
Later today, US manufacturing sector data will influence US-Aussie interest rate differentials and AUD/USD. A higher ISM Manufacturing PMI and rising prices likely widen the US-Aussie interest rate differential in favor of the US dollar. A wider differential could send AUD/USD below the 200-day EMA and $0.64, exposing the $0.63623 support level.
Conversely, a weaker PMI and falling prices may narrow the rate differential and push AUD/USD toward $0.65370.
In addition to economic indicators, trade developments will continue to fuel price volatility.
