Everyone, including Australian dollar traders, is waiting for US Federal reserve chair, Janet Yellen, to speak at the Jackson Hole Symposium later on this evening, hoping that she'll provide some impetus to markets one way or another.
While the possibility is seen as low, there are now more bets that the Federal Reserve could hike rates in September. The Australian Dollar may also have been slightly weakened by news that private sector credit had slipped from 6.2% to 6.0% year-on-year.
"People usually focus on the price of flights and accommodation, and overlook and underestimate the value of the dollar," said Expedia's Australia and New Zealand head, Georg Ruebensal. The average price of hotels in Sri Lanka has nose-dived. Photo: ...
Although Retail Sales in the month of July is the biggest data release for the Aussie dollar in the week ahead, it is less likely to move the currency as much as the travails of iron ore, the country's largest commodity export.
It's been a wild ride for Aussie dollar traders this week with Monday's low of 0.763 giving way to last night's high of 0.7749 when the US dollar was under pressure and the yen was trading down through 100 to the dollar.
The US dollar came under selling pressure overnight. Whether it was the pound reacting to the surprising strength of UK retail sales, the Yen driving the USD below 100, or the Euro heading toward 1.14 it was a night where the bears had the whip hand.
The Aussie also has gained against the euro but is treading water against the yen. CURRENCY SNAPSHOT AT 0635 AEST ON WEDNESDAY. One Australian dollar buys: * 76.70 US cents, from 76.33 cents on Tuesday. * 78.13 Japanese yen, from 78.15 yen.
The Australian dollar shrugged off this week's interest rate cut, as global factors, including the search for yield amid ultra low interest rates proved the bigger influence on its direction, and analysts see little impetus for it to move lower.
The value of the Australian dollar remains as divisive as ever following the Reserve Bank of Australia's latest rate cut as experts argue that it is not over-valued, but its propensity for rallying means the RBA must be vigilant.