RBA, MONETARY POLICY, AUSTRALIAN DOLLAR, AUD/USD – TALKING POINTS:
- RBA alerts rate of interest hike unlikely till 2024 on the earliest
- Official money fee, 3-year yield goal held unchanged at 0.10%
- AUD/USD could also be carving out a big bearish reversal sample
The Australian Dollar turned decrease because the Reserve Financial institution of Australia (RBA) struck an unmistakably dovish tone with June’s financial coverage announcement. Governor Philip Lowe and firm mentioned the situations for an rate of interest rise are unlikely to be met till 2024 on the earliest.
Within the assertion accompanying the speed choice, the central financial institution mentioned that it locations a excessive precedence on a return to full employment. It acknowledged that financial restoration has been stronger than anticipated however warned that the prospect of recent Covid-19 outbreaks is an ongoing uncertainty.
The official money fee and the 3-year yield targets had been left unchanged at 0.10% respectively, as extensively anticipated. Policymakers flagged the July assembly as a time when the yield goal in addition to additional QE asset purchases shall be thought of.
Trying forward, the highlight turns to tomorrow’s first-quarter GDP report. It’s anticipated to point out that output grew 1.5 %, slowing from the three.1 % rise recorded within the ultimate three months of 2020. Main PMI survey knowledge helps the case for a slowdown, although it additionally flags a pickup in April and Might.
Turning to technical positioning, AUD/USD seems to be carving out a Head and Shoulders (H&S) topping sample. Breaking speedy assist within the 0.7664-91 space exposes the setup’s defining neckline assist at 0.7564. A day by day shut beneath that completes the formation, implying a drop beneath 0.72 to observe.
Alternatively, a push above resistance within the 0.7820-49 zone threatens to undo the H&S setup. One other take a look at of the 2021 swing high simply north of the 0.80 determine appears possible on this state of affairs.
AUD/USD day by day chart created with TradingView
AUD/USD TRADING RESOURCES
— Written by Ilya Spivak, Head Strategist, APAC for DailyFX
To contact Ilya, use the feedback part beneath or @IlyaSpivak on Twitter