We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Mixed
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bearish
Gold
Bullish
GBP/USD
Mixed
USD/JPY
Mixed
More View more
Real Time News
  • RT @DanielGMoss: A broad risk-off tone has been seen throughout #APAC trade as the re-imposition of lockdown restrictions in #Melbourne sou…
  • Forex Update: As of 04:00, these are your best and worst performers based on the London trading schedule: 🇬🇧GBP: 0.13% 🇪🇺EUR: 0.04% 🇨🇦CAD: 0.01% 🇳🇿NZD: -0.05% 🇯🇵JPY: -0.07% 🇦🇺AUD: -0.10% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/yVj5r2ggv9
  • Indices Update: As of 04:00, these are your best and worst performers based on the London trading schedule: US 500: 0.09% Wall Street: 0.08% Germany 30: -0.43% France 40: -0.54% FTSE 100: -0.54% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/qnnkxnrU41
  • Learn about the ASEAN-China relationship and how to trade ASEAN currencies like the Singapore Dollar, Indonesian Rupiah, Philippine Peso and Malaysian Ringgit using the Core-Perimeter model. Get your market update from @ZabelinDimitri and @ddubrovskyFX : https://t.co/rNJkPpVCdk https://t.co/NgXSxiuDM9
  • RT @margaretyjy: Listen to my radio interview with Bloomberg this morning as well. Speaking about HKD peg, US earnings, Emerging market opp…
  • Understanding the US-Mexico relationship and how the ebb and flow of economic activity in the former impacts the latter is crucial for trading USD/MXN. Get your $USDMXN market update from @ZabelinDimitri and @FxWestwater here:https://t.co/oCRV13zbF0 https://t.co/w2vtUFUoFs
  • A macro forex trading guide exploring the US-Canada relationship and how to trade the Canadian Dollar through the prism of the Core-Perimeter model. Get your market update from @ZabelinDimitri and @PeterHanksFX here:https://t.co/dF51UMcGFC https://t.co/YEqRNUYx45
  • Commodities Update: As of 02:00, these are your best and worst performers based on the London trading schedule: Silver: 0.22% Oil - US Crude: -0.12% Gold: -0.14% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/7UGWflcF7Y
  • - #NZDCHF outlook bearish as the pair struggles to surmount key resistance range - #NZDCAD trading at 13-month highs, but are technical cues hinting at a pullback? - #AUDNZD is again retreating from five-year resistance – how much will it decline? https://www.dailyfx.com/forex/market_alert/2020/07/08/New-Zealand-Dollar-Analysis-NZDCHF-NZDCAD-AUDNZD.html
  • Forex Update: As of 02:00, these are your best and worst performers based on the London trading schedule: 🇬🇧GBP: 0.08% 🇪🇺EUR: 0.00% 🇨🇦CAD: 0.00% 🇨🇭CHF: -0.04% 🇦🇺AUD: -0.10% 🇯🇵JPY: -0.12% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/lTYr3UzRhP
AUD/USD Rate Rebound Vulnerable to Wait-and-See RBA Policy

AUD/USD Rate Rebound Vulnerable to Wait-and-See RBA Policy

2018-11-06 03:00:00
David Song, Strategist
Share:

Trading the News: Reserve Bank of Australia (RBA) Interest Rate Decision

The Reserve Bank of Australia (RBA) interest rate decision may rattle the recent rebound in AUD/USD as the central bank is anticipated to hold the official cash rate (OCR) at the record-low of 1.50% in November.

Image of DailyFX economic Calendar

It seems as though the RBA will carry the wait-and-see approach into 2019 as ‘growth in household income remains low and debt levels are high,’ and the central bank may continue to tame bets for higher borrowing-costs as ‘the low level of interest rates is continuing to support the Australian economy.

In turn, more of the same from the RBA may drag on the AUD/USD especially as the Federal Reserve sticks to its hiking-cycle, but a material shift in the forward-guidance may trigger a bullish reaction in the Australian dollar should Governor Philip Lowe & Co. show a greater willingness to implement a rate-hike over the coming months. Sign up and join DailyFX Currency Analyst David Song LIVE for an opportunity to discuss potential trade setups!

Impact that the RBA rate decision has had on AUD/USD during the previous meeting

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

OCT

2018

10/02/2018 04:30:00 GMT

1.50%

1.50%

-15

-40

October 2018 Reserve Bank of Australia (RBA) Interest Rate Decision

AUD/USD 5-Minute Chart

Image of audusd 5-minute chart

The Reserve Bank of Australia (RBA) stuck to the sidelines in October, with the central bank keeping the official cash rate (OCR) at the record-low of 1.50% as ‘the Board judged that holding the stance of monetary policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time.’ It seems as though the RBA will retain the wait-and-see approach throughout the remainder of the year as ‘growth in household income remains low and debt levels are high,’ and the central bank may continue to strike a cautious tone going into 2019 as ‘one ongoing uncertainty regarding the global outlook stems from the direction of international trade policy in the United States.

The RBA meeting spurred a limited reaction, with AUD/USD struggling to hold its ground as the exchange slipped below the 0.7200 handle to close the day at 0.7188. Learn more with the DailyFX Advanced Guide for Trading the News.

AUD/USD Daily Chart

Image of audusd daily chart
  • Broader outlook for AUD/USD remains tilted to the downside as the exchange rate continues to track the downward trend from earlier this year, with the failed attempt to test the September-high (0.7315) undermining the advance from the 2018-low (0.7085).
  • Nevertheless, recent developmentsinstill a more constructive view for AUD/USD as the exchange rate closes above the 50-Day SMA (0.7159) for the first time since June, with the Relative Strength Index (RSI) also highlighting a change in behavior as the oscillator snaps the bearish formation from earlier this year,
  • In turn, a close above the 0.7230 (61.8% expansion) region raises the risk for a move back towards 0.7320 (50% expansion) to 0.7340 (61.8% retracement), with the next hurdle coming in around the 0.7400 (38.2% expansion) handle.

Additional Trading Resources

New to the currency market? Want a better understanding of the different approaches for trading? Start by downloading and reviewing the DailyFX Beginners Guide!

Are you looking to improve your trading approach? Review the ‘Traits of a Successful Trader series on how to effectively use leverage along with other best practices that any trader can follow.

--- Written by David Song, Currency Analyst

Follow me on Twitter at @DavidJSong.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.