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.

Free Trading Guides
EUR/USD
Mixed
GBP/USD
Bullish
USD/JPY
Bearish
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
Gold
Mixed
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
Oil - US Crude
Mixed
Bitcoin
Bearish
More View more
Real Time News
  • The latest UK General Election opinion polls continue to show the Conservative Party holding a strong lead over Labour and point to Boris Johnson winning a working majority in Parliament. Get your $GBPUSD market update from @nickcawley1 here: https://t.co/qF04EOUWkI https://t.co/LNl4bXbnpp
  • Recent polls have put Conservatives ahead of Labour and given a boost to $GBP. Get your #Brexit update from @ZabelinDimitri here: https://t.co/l2n53C0cYY https://t.co/oTWfXkaDDt
  • What are the truths and myths of #forex trading? Find out from @DailyFX analysts here: https://t.co/uF75VPzstr #FOMOintrading https://t.co/xeromAGqqx
  • Macro data from around the world have long attested to the urgent need for a trade settlement between the US and China. Increasingly the corporate numbers are saying the same. Get your market update from @DavidCottleFX here:https://t.co/Qon7QUO80c https://t.co/rCOG78QQ2M
  • #Gold prices may fall while the US Dollar gains even as economic policies championed by the Trump administration invite inflation. Get your market update from @IlyaSpivak here: https://t.co/4lHhHsby56 $XAUUSD https://t.co/JmZxckVHdS
  • Cable (GBP/USD) remains just off its seven-month high print around 1.3165 as traders start to move to the side lines ahead of next Thursday’s General Election vote. Get your $GBPUSD market update from @nickcawley1 here: https://t.co/CpCh13J9ZH #Brexit https://t.co/PIh6WUqbsK
  • (Weekly Technical Outlook) GBP/USD, EUR/GBP, GBP/JPY, GBP/CAD Outlook as UK Election Looms $GBPUSD $EURGBP $GBPJPY #UKelection2019 - https://www.dailyfx.com/forex/technical/article/fx_technical_weekly/2019/12/07/GBPUSD-EURGBP-GBPJPY-GBPCAD-Outlook-as-UK-Election-Looms.html?CHID=9&QPID=917702 https://t.co/iuILHYczJ7
  • Why do you require consistency in trading and why does it matter? Find out: https://t.co/WlEFlluGfZ #tradingstyle https://t.co/TkMtJQKatx
  • By issuing debt denominated in $USD, China is making a long-term bet that it will be cheaper to pay back its loans over time in the US Dollar; it believes the value of the US Dollar will fall. Get your market update from @CVecchioFX here:https://t.co/5GO9UrvO4y https://t.co/xV9urXXf48
  • What are some risk trading management techniques? Find out: https://t.co/RShdlDz9RA #tradingstyle https://t.co/M3ASPIHAep
AUDUSD Outlook Hinges on RBA Meeting Amid Bets for 25bp Rate-Cut

AUDUSD Outlook Hinges on RBA Meeting Amid Bets for 25bp Rate-Cut

2019-05-07 03:30:00
David Song, Currency Strategist
Share:

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

The Reserve Bank of Australia (RBA) interest rate decision may trigger increased volatility in the AUD/USD exchange rate amid speculation for a 25bp rate-cut.

Image of DailyFX economic calendar

It remains to be seen if the RBA will reduce the official cash rate (OCR) ahead of the Federal election on May 18 as Governor Philip Lowe & Co. argue ‘a lower level of interest rates could still be expected to support the economy through a depreciation of the exchange rate and by reducing required interest payments on borrowing, freeing up cash for other expenditure.

In turn, a 25bp rate-cut along with a material change in the forward-guidance for monetary policy is likely to produce headwinds for the Australian dollar, but more of the same from the RBA may fuel a larger rebound in AUD/USD as market participants scale back bets for lower interest rates.

Sign up and join DailyFX Analyst Daniel Dubrovsky LIVE to cover the RBA interest rate decision.

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

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

APR

2019

04/02/2019 03:30:00 GMT

1.50%

1.50%

-24

-34

April 2019Reserve Bank of Australia (RBA) Interest Rate Decision

AUD/USD 5-Minute Chart

Image of audusd 5-minute chart

The Reserve Bank of Australia (RBA) kept the official cash rate (OCR) at the record-low of 1.50% in April, with the central bank still endorsing a wait-and-see approach for monetary policy as ‘growth in household consumption is being affected by the protracted period of weakness in real household disposable income and the adjustment in housing markets.’ The remarks suggest the RBA is in no rush to alter the forward-guidance as thelow level of interest rates is continuing to support the Australian economy,’ and it seems as though the central bank will stick to the sidelines ahead of the upcoming elections in May as Governor Philip Lowe & Co. pledge to ‘monitor developments and set monetary policy to support sustainable growth in the economy and achieve the inflation target over time.

More of the same from the RBA dragged on the Australian dollar, with AUD/USD slipping below the 0.7100 handle to close the day at 0.7071. Learn more with the DailyFX Advanced Guide for Trading the News.

AUD/USD Rate Daily Chart

Image of audusd daily chart
  • Keep in mind, the AUD/USD rebound following the currency market flash-crash has been capped by the 200-Day SMA (0.7168), with the exchange rate marking another failed attempt to break/close above the moving average in April.
  • In turn, AUD/USD may continue to give back the rebound from the 2019-low (0.6745) as the wedge/triangle formation in both price and the Relative Strength Index (RSI) appear to be unraveling following the break of the March-low (0.7003); next area of interest comes in around 0.6850 (78.6% expansion).
  • However, lack of momentum to break/close below the 0.6950 (61.8% expansion) hurdle may trigger a larger rebound in AUD/USD as it attempts to fill the gap from earlier this week, with a move back above the 0.7020 (50% expansion) region opening up the Fibonacci overlap around 0.7090 (78.6% retracement) to 0.7110 (78.6% retracement).

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 Strategist

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.