The Reserve Bank of Australia, as widely expected, kept its key interest rate unchanged at 1.00% which kept the Australian Dollar at support levels near a decade low. Despite the ongoing trade war, the economic dependence on China and the overall slowing global economy, Australia managed to print a better than expected current account surplus in the second-quarter while the first-quarter deficit was revised higher. Consumer confidence rose in the latest weekly survey, but retail sales for July posted a surprise contraction. Did bulls get enough data to move the AUDUSD to the upside off of strong support levels or will bears attempt a breakdown? Today’s fundamental analysis will take a look at both upside potential as well as downside risk.

Forex traders will get the key ISM Manufacturing Index out of the US. Economists anticipate it to remain above 50 and indicate expansion, but the Markit Manufacturing PMI already moved below that mark and is indicating a contraction in the manufacturing sector. Will the ISM Manufacturing Index follow suit? The New Orders component is dangerously close to dip below 50 and the Employment component is also slipping. The US Dollar has remained strong as forex traders started to view it as a safe haven trade amidst the global turmoil. How much longer can the US Dollar remain elevated as the US Fed is eyeing to ease monetary policy further? Which impact will this have on the AUDUSD? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month!