A better-than-expected Aussie business spending data supports Aussie. While business spending, as represented by private capital expenditure (CAPEX), fell 5.9% in the second quarter, the actual reading was better than the forecasted drop of 8.4%. The third estimate for 3 for 2020-21 came in at $98,624 million – 12.6% lower than the third estimate for 2019-20. However, the third estimate is 8.9% higher than the second estimate of  2020-21.

Firms did scale back future spending plans, but again by not nearly as much as expected, thanks in part to the mining sector which is benefiting from strong Chinese demand.

Marcel Thieliant, an economist at Capital Economics said “The upshot is that the outlook for capital spending isn’t as gloomy as one would expect in the current environment.” The GDP data is due next week. He now estimated gross domestic product likely fell by around 4.5% in the June quarter, from the previous quarter, up from a previous forecast of 6.5%.

Investor confidence in Australian assets was underlined by details of the government’s huge A$21 billion ($15.20 billion)bond sale on Wednesday, which drew A$66 billion of bids. Some 46% of the record offer went to foreign investors, mostly in Asia ex-Japan, the U.S., and the UK. Fund managers bought almost 31% of the issue and hedge funds contributed to 20%.

Australian shares rose on Thursday, tracking Wall Street’s record-setting rally overnight, as sentiment was lifted by a fall in new COVID-19 cases in the country’s virus hot spot state. The southeastern state of Victoria recorded 23 deaths from the new coronavirus in the last 24 hours and 113 new cases, its lowest daily rise in nearly two months, due to strict lockdown measures.

The Investors are now keen towards the Jackson Hole Symposium, They await the Federal Reserve (Fed) Chair Jerome Powell’s speech, up for publishing at 14:00 GMT, to get the hints of September month policy meeting. The latest rumors suggest the Average Inflation Targeting (AIT), a measure favoring further easy money policy, is on the cards. Though, Talks over the growth stories can’t be ignored. It should also be noted that the US second quarter (Q2) GDP, expected -32.5% versus -32.9%, precedes the speech, and will be the key to watch as well.

AUD/USD 4 Hour Chart:

Support: 0.7199 (S1), 0.7167 (S2), 0.7147 (S3).

Resistance: 0.7251 (R1), 0.7271 (R2), 0.7303 (R3).

In the prevailing condition, Aussie seems to be stronger than Dollar, whether Fed Chair Powell’s speech later today changes the trend is yet to be seen. As of now, we expect a bullish trend for AUD/USD.