Since the interest rate in Australia was lowered at the beginning of the month for the first time since June 2015 to the level of 1.75%, AUD/USD pair has lost so far more than 400 points, still remaining under pressure. While on Friday the US dollar received support from the Federal Reserve Chair Janet Yellen, reporting the tendency to a tight monetary policy (if the economy and the labor market in the US continue to strengthen), the Australian currency fell sharply on Monday's Asian session amid the fall in world iron ore prices. The price of futures for iron ore, the main export product of Australia, dropped by 4.9% in China - the lowest point since February 2015.

Also the Australian dollar has the pressure of expectations for the Australian GDP data expected on Wednesday (03:30 GMT +2). As suggested by many economists, the data will be positive, but any slight downward deviation from the forecast will increase the likelihood of easing monetary policy in Australia.

In the first quarter of this year, there was deflation in Australia for the first time since the financial crisis of 2008. The RBA has recently dramatically lowered the inflation forecast in the country, expecting it to be at less than 2% in 2016.

Also the previously published data indicate a weakening of the momentum of employment growth in Australia.

Thus, several fundamental factors will contribute to the pressure on the quotes of the Australian currency. Among these factors, the main one is the difference between the monetary policies of the Federal Reserve and the RBA.

AUD/USD: the Australian currency is declining. Fundamental Analysis for 30.05.2016

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