Wait-and-See RBA to Keep AUD/USD Under Pressure

Trading a News: Reserve Bank of Australia (RBA) Interest Rate Decision

The Reserve Bank of Australia (RBA) seductiveness rate preference might keep AUD/USD underneath vigour as a executive bank is widely approaching to keep a executive money rate (OCR) during a record-low of 1.50%.

Image of DailyFX mercantile calendar

Fresh comments from a RBA might do small to change a Australian dollar as a executive bank steadfastly promotes a wait-and-see proceed for financial policy, and officials might continue to tame bets for an approaching composition in a money rate as ‘the low turn of seductiveness rates is stability to support a Australian economy.

As a result, a RBA might merely try to buy some-more time, and some-more of a same from Governor Philip Lowe Co. might eventually furnish headwinds for AUD/USD generally as a Federal Reserve appears to be on lane to exercise additional rate-hikes in 2018.

However, an astonishing change in a forward-guidance for financial process is approaching to trigger a bullish greeting as it fuels bets for an RBA rate-hike, and a element composition in a executive bank tongue should worsen a interest of a Australian dollar as officials ready to switch gears. Sign adult and join DailyFX Junior Currency Analyst Daniel Dubrovsky LIVE to cover a RBA meeting.

Impact that a RBA rate preference had on AUD/USD during a prior meeting

July 2018 Reserve Bank of Australia (RBA) Interest Rate Decision

AUD/USD 5-Minute Chart

Image of AUDUSD 5-Minute chart

As expected, a Reserve Bank of Australia (RBA) hold a executive money rate (OCR) during a record-low of 1.50% in July, and it seems as yet a executive bank will hang to a stream process for a foreseeable destiny as ‘inflation is low and is approaching to sojourn so for some time, reflecting low enlargement in work costs and strong foe in retailing.’ The comments advise a RBA is in no rush to exercise aloft borrowing-costs as ‘household income has been flourishing slowly and debt levels are high,’ and Governor Philip Lowe Co. might hang to a stream book via 2018 as ‘one doubt per a tellurian opinion stems from a instruction of general trade process in a United States.

Despite a singular reaction, a Australian dollar gained belligerent following a RBA meeting, with AUD/USD climbing above a 0.7350 segment to tighten a day during 0.7386. Learn some-more with a DailyFX Advanced Guide for Trading a News.

AUD/USD Daily Chart

Image of audusd daily chart

  • Broader opinion for AUD/USD stays slanted to a downside as both cost and a Relative Strength Index (RSI) safety a bearish formations from progressing this year, with new developments in a movement indicator highlighting a risk for a serve decrease in a sell rate as it appears to be gnawing a ceiling trend from June.
  • Still need a tighten subsequent a 0.7320 (50% expansion) to 0.7340 (61.8% retracement) segment to open adult a downside targets, with a subsequent jump around 0.7180 (61.8% retracement) to 0.7230 (61.8% expansion) followed by a overlie around 0.7090 to 0.7110 (78.6% retracement).

Additional Trading Resources

New to a banking market? Want a improved bargain of a opposite approaches for trading? Start by downloading and reviewing a DailyFX Beginners Guide!

Are we looking to urge your trade approach? Review a ‘Traits of a Successful Trader array on how to effectively use precedence along with other best practices that any merchant can follow.

— Written by David Song, Currency Analyst

Follow me on Twitter during @DavidJSong.

About author

Commbank writes off $2.5 million

THE Commonwealth Bank, has paid $180,000 in fines and written off $2.5 million after a programming error caused it to incorrectly approve almost 11,000 overdraft ...