The Australian dollar edged lower against its U.S. counterpart on Monday, but sentiment remained supported amid fresh hopes of progress in tackling the debt crisis in the euro zone. AUD/USD hit 1.0409 during late Asian trade, the session low; the pair subsequently consolidated at 1.0403, falling 0.21%. The pair was likely to find support at 1.0375, the low of January 1 and resistance at 1.0469, the high of January 25. Sentiment strengthened on Friday after the European Central Bank said euro zone banks are to repay EUR137.2 billion in emergency loans this week, indicating that liquidity pressure in the bloc has eased. Investor confidence was also boosted by a report showing that Germany’s Ifo index of business confidence improved to a seven-month high in January, adding to signs of a recovery in the euro zone’s largest economy. Traders remained cautious ahead of U.S. data on fourth quarter growth and the Federal Reserve’s monetary policy statement on Wednesday and U.S. nonfarm payrolls data on Friday. The Aussie was lower against the euro with EUR/AUD adding 0.12%, to hit 1.2917.
EasyForexNews Research Team