AUDUSD on Friday dropped -0.74% to 0.63569. Week ending 2025-02-21 rose 0.01%. What happened.

AUDUSD Analysis

Performance
Period	Pct	Chg	Momentum
Friday	-0.74%	-47.2 Pips
Week 2025-02-21	0.01%	0.4 Pips
February	2.28%	141.9 Pips

Upcoming key events for the new week (London Time)

Wed 12:30 AM Monthly CPI Indicator (12-mth)
Thu 01:30 PM GDP annual rate
Fri 01:30 PM PCE Price Index, excluding food and energy (12-mth)

What happened over the week

In the United States, there were mixed economic signals. The University of Michigan reported a slight rise in the Index of Consumer Expectations from 3.3% in December to 3.5% in January, although the Index of Consumer Sentiment decreased from 67.8 points to 64.7 points, indicating an overall subdued consumer outlook. The Department of Labor noted a rise in Initial Unemployment Insurance Claims to 219K, up from 213K previously, suggesting a weakening job market. The Philadelphia Fed’s Manufacturing Business Outlook Survey revealed significant weakness with a drop from 44.3 points to 18.1 in February. Conversely, positive signals were seen in the New York Empire State Manufacturing Index, which improved from -12.6 points to 5.7, signaling expansion. Residential construction saw slight growth in Building Permits at 1.483 million, but Housing Starts fell sharply to 1.366 million. These indicators suggest a nuanced economic landscape confronting both growth and recessionary pressures.

In Australia, recent data from the Australian Bureau of Statistics indicated an improvement in full-time employment, increasing massively by 54.1K from -23.7K previously. However, the overall Labour Force Monthly Employment Change decreased to 44K from 56.3K, with the Unemployment Rate rising slightly to 4.1% from 4.0%. The Participation Rate grew marginally to 67.3% from a revised 67.2%. The Wage Price Index saw a slight decrease to 0.7% in Q4 from 0.8% in Q3, suggesting ongoing wage growth challenges. The Reserve Bank of Australia adjusted its Cash Rate Target downward to 4.1% from 4.35%, indicating a shift toward accommodative monetary policy to support economic growth amid inflationary pressures.

The recent economic events are likely to exert downward pressure on the AUDUSD pair. The Australian dollar’s challenge is visible in the small but significant drop on Friday when AUDUSD fell by 0.74%. The stronger employment figures provide some upside potential, but the lower cash rate decision reflects the RBA’s concern with sustained economic sluggishness, which may weigh on the currency. Upcoming high-impact events like Australia’s Monthly CPI Indicator and the U.S. GDP annual rate alongside PCE Price Index reports will be key determinants in the currency pair’s movements, adding further volatility and shaping market expectations regarding interest rate trajectories in both countries.

From X (Twitter)

"With employment rising by 44,000 people and the number of unemployed increasing by 23,000 people, the unemployment rate rose to 4.1 per cent," Bjorn Jarvis, ABS head of labour statistics

For more, see https://t.co/KPF9vneGYA pic.twitter.com/E4kkkanDCi

— Australian Bureau of Statistics (@ABSStats) February 20, 2025

What can we expect from AUDUSD for the new week and what happened on Friday?

AUDUSD on Friday dropped -0.74% to 0.64. Price is above 9-Day EMA while Stochastic is falling. For the week ending 2025-02-21, the pair rose 0.01% or 0.4 pips higher.

Looking ahead, AUDUSD looks bearish as the pair posted lower in Friday trading session.

For the new week, our technical outlook is mixed. To see upside interest, we prefer to look at price breakout of week high of 0.64 or at least consolidates above Weekly Pivot level of 0.64. On the downside, we are looking at week low 0.63 or 0.63 (WS1) as immediate support level. AUDUSD need to break on either side to indicate a short-term bias. A break above 0.64 would suggest bullish bias after recent positive movement.

For the month of February, AUDUSD is up by 2.28% or 141.9 pips higher.

Weekly key levels to watch out:

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Statement by the Reserve Bank Board: Monetary Policy Decision Source: Reserve Bank of Australia