RBA meeting minutes were released at today's Asian session. The Board decided to leave the rate unchanged at 2.0%.
Members noted that global economic conditions remained consistent with growth in Australia's major trading partners being around average over the period ahead.
Domestically, the key forces shaping the economy over the past year were much as they had been for some time. Very low interest rates supported strong growth in dwelling investment and, together with strong housing prices, underpinned consumption growth.
Recent data indicated that employment had grown more rapidly than the population and the unemployment rate had been relatively stable since the latter part of the previous year.
Commodity prices fell further and the Australian dollar was depreciated over the past month. Although the exchange rate against the US dollar was close to levels last seen in 2009, the decline in the Australian dollar had been more modest in terms of a basket of currencies.
AUD/USD
The aussie bounce froma 6-year low ahead of the RBA minutes. After the minutes, the aussie volatility was arrested at the Asian session. US dollar bulls are unlikely to lose their grip. Traders eye Q2 inflation readings and RBA governor Stevens's speech scheduled for tomorrow.
The cross found support at 0.7268 and 0.7233. The cross is trading at 0.7369 at the Asian session. In the daily chart, the recent price movement brought 0.7349 as the key level to watch on a daily closing basis. The real selling ignites below 0.7230 for another 200 pips fall. The fall in commodity prices badly hurts the Australian economy. After the commodities super cycle, iron prices have been falling very badly. The recent gold prices added some more pressure to the AUD.
For an intraweek period, the cross favors selling on a rise. In an extreme case, the cross can climb towards 0.7460, but it is unlikely to happen. Use rises to sell with sl 0.7500. The intraday support is found at 0.7330 and 0.7300. Fresh selling is available below 0.7300 with targets at 0.7270, 0.7250, and 0.7230. A low around 0.7300 is likely to be reached today.
