RBA preview – what to expect in AUD/USD?

By FXStreet AUD/USD is the one to watch today and those on the periphery such as the Kiwi, CAD and Yen for related yet different reasons.

AUD/USD has been able to set-up prior tot he RBA today close to the 0.77 handle while the greenback continues to fall back as the Fed’s window of opportunity to hike rates this year is narrowing rapidly, lifting prospects for a recovery in commodities and subsequently supporting the Aussie. However, today we have the RBA and the Aussie will be on the knee-jerk purely related to the decision on aussie domestics and the accompanying statement.

A cut by the RBA could be justified

There are a number of justifications for the RBA to act this time around after a period of being on hold. The last time the Bank acted was on May 5th 2015 when the RBA cut rates by 25bps to 2.00% and where rates have stayed ever since. The time before that was Feb with an initial 25bps from 2.50%.

2015 was a year of outstanding jobs performance and Stevens was encouraged by domestic growth in the economy and an Aussie adjusting to the commodity prices enabling him to feel confident that policy …read more

Source:: FX Street