The Reserve Bank of Australia leaves the interest rate unchanged in its April meeting, as widely expected. The institution led by Governor Phillip Lowe expressed worries about stagnant wages and with the jobs market in general. They also dedicate quite a few words to the housing sector. Some areas experience “briskly” rises.
On the positive side, they are optimistic about global growth and that a reduced reliance on interest only housing loans would be regarded as a positive development.
Regarding the Australian dollar, the RBA repeated its beaten stance that an appreciation of the exchange rate would complicate the transition away from the reliance on the mining sector.
AUD/USD, which was already under pressure after the weak retail sales extended its slide. The pair trades at 0.7580, below support at 0.7610. Further support awaits at 0.75, a very round level. Below, 0.7440 and 0.7375 await the pair.
The drop in Aussie/USD also comes against a “risk-off” trading environment, which favors the Japanese yen and does not do any favors to the Aussie. Other commodity currencies such as the loonie and the kiwi are also on the back foot.
Another important Australian release awaits traders. See how to trade the Australian trade balance with AUD/USD.
Here is how the pair is trading in recent hours. Note the downfall that is a direct result of the RBA decision.
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