Gross Domestic Product (GDP) is a measurement of the production and growth of the economy. It is considered by analysts as one the most important indicators of economic activity. Thus, publication of Australian GDP may have a significant impact on AUD/USD.
Here are all the details, and 5 possible outcomes for AUD/USD.
Published on Wednesday at 1:30 GMT.
Indicator Background
GDP is released quarterly, and provides an excellent indication of the health and size of the economy in the past quarter. Therefore its publication is always watched closely by traders.
The GDP reading for the past quarter was a dismal -1.2%, the lowest figure in over four years. The forecast for September GDP is 1%, although this seems overly optimistic. The fall in commodity prices and slowdown in the Chinese economy will likely impact have a negative impact on Australian exports and may well lead to a drop in AUD/USD.
Sentiments and levels
Although the Aussie has managed to hold its ground of late, there are few indicators that point to a rise in AUD/USD. Thus, the overall sentiment is bearish on AUD/USD towards this release.
Technical levels, from top to bottom: 1.0775, 1.07, 1.06, 1.0530, 1.0420, 1.0314.
5 Scenarios
- Within expectations: 0% to 1.7%. In such a scenario, the AUD/USD is likely to rise within range, with a small chance of breaking higher.
- Above expectations: 1.8% to 2.3%: An unexpected higher reading can send the pair well above one resistance line.
- Well above expectations: Above 2.3%: The chances of such a scenario are low. Such an outcome would push AUD/USD upwards, and a second resistance line might be broken as a result.
- Below expectations: -1% to 0%: A negative GDP figure could cause the pair to fall and break one level of support.
- Well below expectations: Under -1%. Given the weak global economy, such an outcome cannot be discounted. In this scenario, the AUD/USD will fall and could break a second support level.
For more about the Aussie, see the AUD/USDforecast.