Australian Dollar US Dollar Exchange Rate Continues Sliding after Fed Rate Hike
The Australian Dollar to US Dollar (AUD USD) exchange rate continued tumbling early on Friday as the Federal Reserve rate decision continued pressuring the ‘Aussie’.
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US Dollar (USD) Rises as Fed Strikes Hawkish Tone towards Future Rate Hikes
The Australian Dollar slid against the US Dollar yesterday as the Fed voted to raise US interest rates from 0.50% to 0.75% in December, only its second rate rise in a decade.
However it was not so much the actual hike that bolstered the ‘Greenback’ as investors had largely priced it in weeks ago as the odds of the hike broke 90%. Instead it had more to do with Fed Chair Janet Yellen’s hawkish tone as she forecast that there may be up to three rate hikes next year if the US economy continues its current growth.
Australian Dollar (AUD) Pressured by Rise in Unemployment
The Australian Dollar was also pressured by a rise in the Unemployment Rate as it rose from 5.6% to 5.7% in November.
This comes despite a surge in jobs during the same period as the numbers of newly employed rose from 15.2k in October to 39.1k in November, outpacing predictions that it would see a more modest rise to 17.5K. However the jump was not enough to offset increased participation that caused the rise in the unemployment rate.
AUD USD Forecast: Fall in Housing Permits May Weigh on US Dollar
The AUD USD exchange rate may rally later today as the US releases its latest housing data, which is expected to show that new Building Permits dropped from 0.3% to -1.2% in November.
Meanwhile the Australian Dollar may also be bolstered by rising risk appetite if commodity prices remain stable.
Current Interbank Exchange Rates
At the time of writing the AUD/USD exchange rate was trending around 0.73 and the USD/AUD exchange rate was trending around 1.35