Australian Dollar Soft as Traders Wait for FOMC

The Australian dollar was soft today falling against some of its major rivals and trading flat versus others. With just one relatively minor report released in Australia today, the decline of the Australian currency was likely the result of outside factors.
The most obvious factor discouraging traders from buying riskier currencies was the announcement of monetary policy from the US Federal Reserve later today. Some market analysts also pointed at other possible reasons for risk aversion. The slow progress of coronavirus vaccine rollout in Europe, hampered further by a temporary suspension of AstraZeneca vaccine usage, was one of them. Another one was geopolitical tensions between the United States and a number of other countries, primarily China but also North Korea and Russia.
As for today’s macroeconomic data in Australia, the six-month annualized growth rate in the Westpac–Melbourne Institute Leading Index, which shows the likely pace of economic activity three-to-nine months into the future, dropped from 3.83% in January to 2.64% in February. Despite the decline of the index, the report was optimistic, saying:

The growth rate in the Index continues to hold comfortably in positive territory indicating that growth through much of 2021 will be above trend.

Tomorrow, the Australian Bureau of Statistics will release an employment report for February. Analysts predicted that it will show a healthy increase in employment by 31,500 and a fall in the unemployment rate from 6.4% to 6.3%.
AUD/USD dropped from 0.7742 to 0.7713 as of 12:02 GMT today. EUR/AUD gained from 1.5367 to 1.5420. AUD/CHF was flat at 0.7160.
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Original from: www.earnforex.com