Ella 
AUD/USD rose 0.50% to trade at 0.6610 on Monday. Despite the uncertainty surrounding the broader market, the daily chart suggests a neutral to bullish outlook as bears battle for turf. In this sense, while the market is waiting for the Federal Reserve’s decision on Wednesday, the market is also preparing for key Australian data on Tuesday to consolidate its bets on the Reserve Bank of Australia’s interest rate policy.
In this sense, the market is preparing for retail sales to record a -3.5% monthly rate last month, suggesting a contraction in consumer spending. The RBA’s reaction to domestic economic indicators remains to be seen, although markets currently don’t expect a rate cut until the second half of 2024.
At the same time, in the United States, as the Dallas Fed Index fell sharply, uncertainty about the direction of the Federal Reserve’s policy became increasingly prominent. While the Fed is expected to keep interest rates on hold at its upcoming meeting, expectations suggest it could start an easing cycle by mid-year, which could weaken the dollar. Jerome Powell’s speech will be key.
