AUD/USD Daily Fundamental Analysis for June 02, 2011

By ForexMansion.com

The Australian currency has gained against its major currencies after the Australian economy's report showed the gross domestic product contracted by 1.2% in the first quarter of this year, from the previous three months, almost in line with analysts' estimates that referred to a drop by 1.1%.

In recent days, the Australian dollar has reached an oversold area before the GDP report, which means that investors had stopped their selling transactions during the period, and while they are waiting the upcoming fundamental data that will show whether the economy will come out from its contraction phase or will the economy enter another shrinking phase

Australia's government forecasts mining investment of A$76 billion next fiscal year, spurring companies to hire workers and prompting the RBA to predict the unemployment rate will fall to 4.25 percent by December 2013. Australia recorded its biggest annual job growth on record last year before hiring cooled.

We can see that the Australian economy is going to record an expansion in the 2^nd quarter more than expected, because of the business investment sector has gained a great performance during the first quarter of the year, which is the third consecutive quarterly increase, affected by the improvements in mining sector.

Meanwhile, the government is working to put the economy on the track, the Reserve Bank of Australia (RBA) decided this month to leave interest rates steady for the fourth consecutive month at the highest level of 4.75% to support the economy after the floods and cyclone damage that hit the nation.

On Thursday, Australian trade balance reading for the month of April will be released at 01.30 GMT, after it recorded a surplus by A$1740 million in March, the expectations indicated that Australia trade balance surplus is to expand in April.

Moreover, the retail sales seasonally adjusted (APR) in Australia will be released at 01.30 GMT after it unexpectedly declined to -0.5% in March.

The US economy is to release its unit labor costs (1Q) at 12.30 GMT, where the final reading is expected to increase by 0.8% from the previous of 1.0% in 4th quarter. While the non-farm productivity for the first quarter is expected to increase by 1.8% compare the previous reading of 1.6%.

At 12:30 GMT, U.S economy will issue its weekly initial claims, where the number of people filing for first-time claims for the state unemployment after they unexpectedly rose by 424 thousand last week.

The factory orders index for April is to be published at 14:00 GMT, and it's expected to come at 0.3% down from the previous 3.0%.

Originally posted here

Find more information about technical analysis, fundamental analysis and news on ForexMansion.com.

About ForexMansion.com:
The Finance Mansion Network operates global financial websites including www.ForexMansion.com. Our goal is to provide our readers with the most quality, accurate and up-to-date technical analysis, fundamental analysis and news in order to assist them in making the right financial decisions.
The Finance Mansion Network includes www.FinanceMansion.com, www.ForexMansion.com, www.StocksMansion.com, www.CommoditiesMansion.com and many more.