The Australian dollar strengthened against the other major currencies in the Asian session on Tuesday after minutes from the Reserve Bank of Australia’s October 6 meeting said the bank is in no rush to cut interest rates again.
The minutes revealed that the central bank policy board members are of the view that the country’s economic recovery continues to be on track, albeit at a gradual pace.
“The board judged that it was appropriate to leave the cash rate unchanged at this meeting. Information about economic and financial developments, both domestically and abroad, would continue to inform the board’s assessment of the outlook,” the minutes said.
At the meeting, the RBA decided to keep the cash rate unchanged at the record low 2.00 percent for the fifth straight month. The bank had lowered the rates by 25 basis points each in February and May.
Monday, the Australian dollar fell to 0.56 percent against the U.S. dollar, 0.16 percent against the yen, 0.20 percent against the euro and 0.56 percent against the Canadian dollar.
In the Asian trading, the Australian dollar rose to a 5-day high of 0.9472 against the Canadian dollar, from yesterday’s closing value of 0.9438. On the upside, 0.96 is seen as the next resistance level for the aussie.
Against the U.S. dollar, the yen and the euro, the aussie advanced to 0.7275, 86.95 and 1.5565 from yesterday’s closing quotes of 0.7248, 86.60 and 1.5621, respectively. If the aussie extends its uptrend, it is likely to find resistance around 0.74 against the greenback, 89.00 against the yen and 1.50 against the euro.
The aussie edged up to 1.0689 against the NZ dollar, from an early 4-day low of 1.0649. The next possible resistance for the aussie is seen around the 1.10 area.
Meanwhile, the other Antipodean currency, the NZ dollar, also rose after the release of RBA minutes.
The NZ dollar rose to 0.6815 against the U.S. dollar and 81.44 against the yen, from yesterday’s closing quotes of 0.6785 and 81.09, respectively. If the kiwi extends its uptrend, it is likely to find resistance around 0.69 against the greenback and 82.00 against the yen
Against the euro, the kiwi edged up to 1.6614 from yesterday’s closing value of 1.6677. The kiwi may test resistance around the 1.64 region.
Looking ahead, Swiss trade data and German PPI data, both for September, are due to be released in the pre-European session at 2:00 am ET.
In the European session, Eurozone current account data for August is slated for release.
At 5:45 am ET, Bank of England MPC Member Ian McCafferty will deliver a speech about the evolution of financing conditions for businesses since the 2008 crisis and to what extent they are still hindering the economy, in London.
Fifteen minutes later, Bank of England Governor Mark Carney will testify on the Bank of England Bill before the Treasury Select Committee in London.
In the New York session, Canada wholesale sales data for August and U.S. housing starts and building permits, both for September, are slated for release.
At 9:00 am ET, Federal Reserve Bank of New York President William Dudley is expected to speak about “The Evolving Structure of the U.S. Treasury Market” in a conference hosted by the Federal Reserve Bank of New York. Federal Reserve Governor Jerome Powell will also deliver opening remarks at the same conference.
The material has been provided by InstaForex Company – www.instaforex.com