AUD/USD Daily Forecast: US Labor Market and Aussie Housing Data in the Spotlight

Australian Housing Sector Under Scrutiny

On Friday, September 6, housing sector data will place a spotlight on the AUD/USD and the RBA.

Economists forecast home loans to increase by 1.0% in July, up from 0.5% in June. An upward trend in home loans could indicate stronger demand, possibly signaling higher house prices. Higher demand and rising house prices may drive rents up, potentially fueling housing services and headline inflation.

Rising housing services inflation may pressure the RBA to maintain its higher-for-longer rate path to tame inflation. Higher borrowing costs may reduce the demand for home loans, possibly easing demand for homes and cooling the housing market and rents.

RBA Governor Michele Bullock Cites Housing Costs as Key Inflation Driver

On Thursday, RBA Governor Michele Bullock also emphasized in her speech that rate cuts were unlikely in 2024. The RBA Governor also said,

“The key drivers of elevated inflation at the moment are housing costs and market services inflation, which remain above their average levels and have been easing only gradually. Year-ended growth in advertised rents is still high, reflecting pressure from a rebound in housing demand and limited supply response.”

Expert Views on the RBA Rate Path

AMP Head of Investment Strategy and Chief Economist Shane Oliver remarked on RBA Governor Bullock’s speech, stating,

“RBA Gov Bullock reiterated a hawkish stance with: continuing excess demand; inflation risks still skewed to upside; based on its current forecasts the Board does not expect to be cutting in “near term”. We continue to expect the first cut in Feb, but with risk of an earlier cut.”

Higher-than-expected home loans may push the AUD/USD toward $0.68.

US Economic Calendar

Later in the Friday session, the US Jobs Report will be a crucial data release as the US labor market faces increased scrutiny.

Economists forecast the US unemployment rate will drop from 4.3% in July to 4.2% in August. A lower unemployment rate could support wage growth, fueling consumer spending and demand-driven inflation. A less dovish Fed rate path may limit wage growth, possibly curbing consumer spending.

In addition to unemployment figures, investors should closely monitor trends in nonfarm payrolls, another key indicator of labor market strength. Economists expect nonfarm payrolls to increase by 160k in August, up from 114k in July. Higher figures could signal a resilient US labor market, reducing bets on a 50-basis point September Fed rate cut.

Better-than-expected labor market data could boost US dollar demand, possibly pulling the AUD/USD toward $0.66500.

Expert Views on the US Labor Market

BCA Research Chief Global Strategist and Director of Research commented on Thursday’s weekly jobless claims figures, stating,

“Unemployment claims come in better than expected. Claims display strong seasonal patterns and normally decline at this time of the year. While initial claims are similar to where they were in recent years (ex pandemic), continuing claims still look slightly elevated.”

Short-Term Forecast: Bullish

Near-term AUD/USD trends will hinge on the US Jobs Report. Positive US labor market data could reduce expectations of a 50-basis point Fed rate cut, suggesting an AUD/USD drop toward $0.66500.

Investors should stay alert to economic data and central bank commentary that may influence AUD/USD price trends. Monitor the real-time data, news updates, and expert commentary to adjust your trading strategies.

Stay updated with our latest views and analysis to manage exposures to the forex markets.

AUD/USD Price Action

Daily Chart

The AUD/USD remained comfortably above the 50-day and 200-day EMAs, confirming bullish price trends.

A return to $0.67500 could support a move toward the $0.67967 resistance level. Furthermore, a break above the $0.67967 resistance level could give the bulls a run at the $0.68500 level.

Investors should consider the US Jobs Report and central bank commentary.

Conversely, a break below the $0.67003 support level may give the bears a run at the 50-day EMA.

With a 14-period Daily RSI reading of 55.02, the Aussie dollar may rise to $0.68500 before entering overbought territory.