AUD/USD: trading ahead of RBA
AUD/USD is trading near the lowest levels since the middle of April.
The Reserve Bank of Australia will meet on Tuesday morning. According to the consensus forecast, the regulator will leave the benchmark rate unchanged at 2% level.
Last week Australia released very weak capital expenditure data. Still, the general opinion is that the RBA will want to wait and see how the economy develops staying on hold in June and July.
Still, the majority of analysts think that the RBA will have to cut rates later this year. On the one hand, Australian currency has recently weakened – this helps to support the nation’s exports. On the other hand, New Zealand’s dollar and Japanese yen have also depreciated against the greenback, and this reduces the overall positive impact for Aussie.
The market’s attention will be focused on the central bank’s statement. We don’t think that the RBA will plunge into dramatic negative comments, but it might try to create some bearish pressure on Australian currency.
The outlook for Tuesday is moderately bearish. Support is at 0.7625/00 ahead of 0.7550/30. Resistance is at 0.7730 and 0.7800.
On Wednesday Australia will release Q1 GDP figures (small gain in economic growth is expected), while on Thursday don’t miss the publication retail sales and trade balance. On Friday volatility will increase because of the non-farm payrolls data (NFP) due in the US.