The AUD/USD pair broke the resistance just above 0.7800 to open up steep gains though backed by a renewed surge in industrial commodities. According to economists at Westpac, there is scope for a move above the 0.8050 level.
Key quotes
“A$ TWI is printing three-year highs, but the Reserve Bank of Australia (RBA) can’t start to talk about excessive appreciation with base metal and energy prices surging and iron ore around $170/t.”
“On Tuesday, the RBA Board should stress the long road to a labour market tight enough to drive wages growth to 3.5%+, consistent with inflation returning to the 2.5% target.”
“The RBA is unlikely to provide encouragement to those pondering tightening ahead of the guidance provided last month. Still, positioning for a global rebound should keep AUD/USD well supported on dips, with scope for 0.8050+ multi-day.”
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