AUD/USD continues on a four-day winning streak, gearing up for the Reserve Bank of Australia's (RBA) interest rate decision set to be unveiled on Tuesday. The AUD/USD pair holds strong around 0.6520 during the Asian session on Monday, aiming to mark a three-month high.
Anticipated to increase by 25 basis points, the RBA's decision aligns with Aussie inflation hovering at the edges supporting the Aussie Dollar (AUD). The AUD/USD pair is further buoyed by a surge in risk appetite, fueled by the expectation that the US Federal Reserve (Fed) has concluded its monetary policy tightening after cooling economic data from the United States (US), potentially signaling no interest rate hike in the upcoming December meeting.
US Dollar Index (DXY) aims to maintain stability following a significant dip, hovering around 105.10 at the time of writing. The 10-year US bond yield, currently at 4.48%, reflects a negative inclination after the release of weaker nonfarm payrolls on Friday, which fell below expectations, contributing to the subdued sentiment for the US Dollar (USD).
US Bureau of Labor Statistics released US NFP data, revealing a figure of 150K for October. This fell short of the anticipated 180K and marked a significant decline from the 297K recorded in September. Average Hourly Earnings (MoM) declined to 0.2% instead of being consistent at 0.3% as expected. While year-over-year came in at 4.1% against the 4.0% expectations.
Market participants will keenly watch Australia's interest rate decision and China's release of Trade Balance data on Tuesday, given the strong trade ties between the two nations. On the US side, the Michigan Consumer Sentiment Index will be eyed later in the week.
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