AUD/USD last trades flat at $0.6924 after....>

AUSSIE: AUD/USD last trades flat at $0.6924 after adding 42 pips Thursday, as

investors were keen to sell USD in the wake of dovish FOMC rhetoric.

- The rally occurred even as the perceived chance of more policy easing from the

RBA increased substantially. Governor Lowe used his Thursday's speech to note

that it is "not unrealistic" to expect a further cut in the cash rate amid

persistent underemployment. Implied probability of a cut at the next RBA policy

meeting increased to ~70% from the pre-speech ~50%.

- Even with the RBA's current easing bias, MNI understands that the Bank would

prefer to cut rates to zero rather than launch quantitative easing, particularly

if cuts are backed up by fiscal stimulus.

- Bulls look to the nearby 21-DMA, which kicks in at $0.6930. A break here would

shift focus to $0.6964/67, which registered highs on Jun 12/11. Bears target the

200-HMA and 100-HMA, which are located at $0.6903 and $0.6878 respectively.

- Focus turns to Australian CBA PMIs, due at the top of the hour. Next week's

docket includes speeches from RBA's Lowe (Monday) and Bullock (Tuesday), with

private sector credit data due on Friday.