Australian Dollar falls after the RBA monetary policy statement
Daily Currency Update
Key Movers
Investors were left disappointed yesterday after The Reserve Bank of Australia failed to deliver the hawkish stance on rates many had expected. Whilst keeping the official cash rate unchanged at 1.5 percent, in most part a neutralised statement followed with policy makers presenting an equally balanced argument for hiking or in fact reducing rates. Whilst making specific reference to how a stronger Australian dollar would complicate the domestic economies transition away from the mining boom, the AUD was heavily sold in the aftermath, reaching an eventual low of 0.7591 when valued against its US Counterpart. Opening this morning notably lower at a rate of 0.7603 the release of minutes from the Federal Reserve’s most recent meeting this evening represents the biggest risk event of the next 24 hours.The New Zealand Dollar trading was light on yesterday and traded in a tight range as the United States were on holidays for Independence day. Opening Tuesday morning at 0.7292 against the US Dollar, the Kiwi traded to an intraday low of 0.7262 despite NZIER Business Confidence remaining steady in the June Quarter. Sideways movements continued to the domestic close before the latest GlobalDairyTrade Auction saw a drop in the price index by 0.4%. Despite the drop we saw little impact on the NZD/USD post auction, with an eventual pairing of losses overnight to see the New Zealand Dollar open this morning at 0.7290.
Was a quiet session overnight with US traders enjoying the Independence Day holiday. Looking ahead today all attention will turn to the upcoming Federal Open Market Committee (FOMC) Minutes in the US. If the minutes are more hawkish than expected, confident that inflation will move higher, could confirm their tight monetary policy intentions lifting rates in the near future. Against the Euro overnight the Greenback edged higher reaching a high of 1.1376. The EUR/USD pair is currently trading at 1.1354. We now expect any upward push will likely meet resistance around 1.1380. The Pound Sterling also lost ground against the US dollar down to 1.2911, its lowest since last Wednesday.
Expected Ranges
- AUD/USD: 0.7500 - 0.7700 ▼
- NZD/USD: 0.7200 - 0.7380 ▼
- GBP/AUD: 1.6850 - 1.7050 ▲