AUD/USD Outlook (6 July 2022)

FX:AUDUSD   Australian Dollar / U.S. Dollar
The AUDUSD tracked lower from the 0.6850 level due to pressures from the DXY climb. The DXY strength was primarily due to the weakness in the Euro and the increasing concern of a global recession.

Look for further downside as the AUD continues to be weighed down by depressed commodity and the expectation of lower economic activity and demand from a recession.

The RBA hiked rates by 50bps taking Australian overnight rates to 1.35%. However this move had been signalled early on and is likely to have been priced in. A rate hike is also likely to bring the Australian economy onto the path of a recession.

Therefore, AUDUSD could retrace towards 0.6850 but look for a reversal from the current level of 0.68, down towards support level of 0.67

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