- AUD/USD drops to 0.6516 before recovering, trading within 0.6500-0.6540 after Fed's "hawkish" hold.
- Fed acknowledges inflation progress but remains cautious, strengthening the US Dollar.
- Key resistance at 0.6524, 0.6532, and 0.6541 (50, 100, 200-hour SMAs); support below 0.6500 with potential to test 0.6479 and 0.6450 levels.
The AUD/USD extended its losses and tumbled after the Federal Reserve (Fed), despite holding rates unchanged, resisted lowering borrowing costs. Officials recognized the progress on inflation but are not fully confident in beginning the easing policy. The pair traded between 0.6500-0.6540 after Fed Chair Jerome Powell's press conference.
AUD/USD pressures to 0.6500; will Powell push prices lower?
Powell and company delivered a “hawkish” hold, even though they made some changes to the monetary policy statement. Nevertheless, stating that the Federal Open Market "Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%” strengthened the US Dollar, which has trimmed some of its losses.
The Federal Reserve acknowledged that inflation has eased somewhat over the year but “remains somewhat elevated.” Policymakers noted that the dual mandate risks have become more balanced and that “the Committee is attentive to the risks to both sides of its dual mandate.”
Regarding its balance sheet reduction, the Committee stated it “will continue reducing its holdings of Treasury securities and agency debt and agency mortgage‑backed securities.” The Fed reinforced its commitment to returning inflation to its 2% objective.
AUD/USD Reaction to Federal Reserve’s decision
The AUD/USD trades volatile and fell to 0.6516 on the Fed’s policy statement release, yet has recovered some ground, yet faces key resistance levels at the 50, 100, and 200-hour SMAs, each at 0.6524, 0.6532, and 0.6541.
If Powell turns dovish, those levels could be cleared and will expose the 0.6600 figure. Otherwise, further AUD/USD weakness could cause the pair to fall beneath 0.6500 and test today’s low of 0.6479, followed by the 0.6450 psychological level.
Australian Dollar PRICE Today
The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the Euro.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.06% | 0.02% | -1.22% | -0.27% | 0.19% | -0.60% | -0.17% | |
| EUR | -0.06% | -0.02% | -1.24% | -0.34% | 0.14% | -0.64% | -0.22% | |
| GBP | -0.02% | 0.02% | -1.26% | -0.32% | 0.14% | -0.62% | -0.21% | |
| JPY | 1.22% | 1.24% | 1.26% | 1.02% | 1.43% | 0.63% | 1.10% | |
| CAD | 0.27% | 0.34% | 0.32% | -1.02% | 0.44% | -0.33% | 0.09% | |
| AUD | -0.19% | -0.14% | -0.14% | -1.43% | -0.44% | -0.78% | -0.36% | |
| NZD | 0.60% | 0.64% | 0.62% | -0.63% | 0.33% | 0.78% | 0.43% | |
| CHF | 0.17% | 0.22% | 0.21% | -1.10% | -0.09% | 0.36% | -0.43% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD: Next target comes at the 200-day SMA
AUD/USD managed to make a U-turn and reverse the earlier pullback to fresh lows near 0.6480, reclaiming the area beyond 0.6500 the figure on the back of further losses in the US Dollar.
EUR/USD sees the glass half-full after the Fed
EUR/USD left behind part of the weekly retracement and flirted with the mid-1.0800s in response to the increased selling pressure in the Greenback after Chair Powell hinted at a September rate cut.
Gold rises to daily highs as Powell unveils a probable rate cut
The precious metal maintains its bullish bias, and climbs to fresh tops past $2,430 per ounce troy after a September rate cut remains on the table.
Ripple rallies on hope of lawsuit win, XRP extends gains to $0.65
Ripple (XRP) is making headlines for the anticipated final ruling in the Securities & Exchange Commission (SEC) lawsuit. The lawsuit and SEC’s stance on XRP has acted as an influential market mover for XRP since the beginning.
FOMC: 'Twas the meeting before rate cuts
As was widely anticipated, the FOMC left the fed funds rate unchanged at the conclusion of today's meeting, but it opened the door to potentially easing policy at its next meeting on September 18.