Australia RBA Cash Rate Decision
The key event from the Australia will be RBA’s Cash Rate Decision scheduled at 0430 GMT/1000 IST. Short term interest rates are the paramount factor in currency valuation – traders look at most other indicators merely to predict how rates will change in the future. On the other side, Rate Statement is among the primary tools the RBA Reserve Bank Board uses to communicate with investors about monetary policy. It contains the outcome of their decision on interest rates and commentary about the economic conditions that influenced their decision. Most importantly, it discusses the economic outlook and offers clues on the outcome of future decisions.
In today’s RBA meet, there are not many expectations from the RBA as the bank likely to keep most policy measures unchanged. Recently RBA has released lower than expected inflation data but unemployment rate too dropped noticeably giving mixed signal of the economy. Important to note here that the RBA did signal in their May meeting minutes that they would make a decision on the next stage of their QE and bond yield control programme (YCC) at their July meeting. Any clear decision on QE may give volatility to the AUD parity.
Let’s see how AUD has reacted during the previous data release:
AUD/USD: The Aussie strengthens sharply ahead of RBA’s Interest Rate Decision. The pair made intraday high at $0.7768 and low at $0.7728. A day as well as H1 chart with triple EMA is bullish for the time being. A sustained close above $0.7770 requires for the upside rally. Alternatively, a consistent close below $0.7740 will check further supports.
Key Resistances: $0.7772, $0.7790, $0.7826, $0.7854, $0.7887
Key Supports: $0.7728, $0.7702, $0.7677, $0.7638, $0.7600
Take a look and do trade wisely!