The Australian dollar has shown great resilience. Despite various pressures, it refuses to let go of the round 0.94 level and remains quite steady in range.
As the currency faces another potential attempt to talk it down, can it defy the wishes of the central bank once again?
The Australian dollar was unable to break above 0.95. Some weak data from China and Australia sent it down, and then RBA governor Glenn Stevens kicked it even lower, in what seemed like a perfect timing.
However, after hitting a low of 0.9328, the pair recovered. Poor employment data in Australia was needed to send it back down below 0.94 after an impressive recovery.
Yet again, the head of the Reserve Bank of Australia attempted to talk the currency down. using stronger words:
It’s hard to see how most of those metrics would have the Aussie dollar quite this high. That’s why we’ve said that our sense is that some of the investors are maybe underestimating the probability of a material decline at some point, but I can’t say when that might be.
These words were heard late on Friday and they didn’t do much.
The Australian dollar now faces an official document from the RBA: the meeting minutes of the last meeting. This is another chance for the Bank to talk down the currency. Can a document have a stronger impact than the public appearance? We’ll soon know.
And this is not the only important event this week: Chinese GDP is released on Wednesday and is predicted to show the same steady growth of 7.4% (annualized) in Q2, as in Q1 2014.
For more, see the AUDUSD forecast and here is how it looks on the charts:
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