AUD/USD flat after volatile week

The Australian dollar is broadly unchanged versus the US dollar this week following a bout of volatility.

The Aussie is trading at $0.9176, up 0.3% on the day but largely flat on the week as talk of a Chinese stimulus package and strong US jobs data pushed the currency pair around.

The Australian dollar dropped at the beginning of the week after some profit-taking from last week’s rally. Speculation of a Chinese stimulus package then boosted the aussie, as China is a large buyer of minerals from Australia.

Yesterday AUD/USD fell after the level of people claiming unemployment benefit in the US dropped to its lowest level since October 2007. The Federal Reserve have previously stated that it will trim its bond-buying scheme if the labour market improves, and so the announcement triggered aussie selling as tapering could begin as early as next month.

At 2.55pm (London time), the University of Michigan consumer confidence figures are revealed; economists are expecting a reading of 85.6 but if the report is stronger-than-expected we could see a drop off in AUD/USD.

Spot FX AUD/USD (DFB) chart

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