AUD/USD under pressure of Australian Q3 GDP today, medium-term o
The Reserve Bank of Australia ended Tuesday's meeting with rates at a record low of 1.5% following two easings this year, but conceded the annual pace of growth was set to slow.
RBA Governor Philip Lowe said: “Some slowing in the year-ended growth rate is likely, before it picks up again. The outlook for business investment remains subdued, although measures of business sentiment remain above average.”
Interbank futures implied a probability of 22% for a cut by mid-2017, up from 14% before the RBA decision. In our opinion the monetary easing cycle has been already ended and the next change in rates will be a hike.
Earlier in the session, figures on net exports and government spending proved softer than expected. Net exports trimmed 0.2 percentage points from GDP in the third quarter. The drag came even as rising commodity prices helped sharply narrow the country's current account deficit to AUD 11.4 billion, from AUD 15.9 billion in the second quarter.
A report on Australia's GDP is due on Wednesday and there is a risk of a small contraction, the first since early 2011. That is why the AUD/USD may be under pressure in the coming hours. In our opinion this would be a good opportunity to open AUD/USD long. We think that commodity prices will become the dominant driver for AUD/USD again, leaving room for Aussie appreciation over the medium term
GrowthAces.com - Daily Forex Trading Strategies
RBA Governor Philip Lowe said: “Some slowing in the year-ended growth rate is likely, before it picks up again. The outlook for business investment remains subdued, although measures of business sentiment remain above average.”
Interbank futures implied a probability of 22% for a cut by mid-2017, up from 14% before the RBA decision. In our opinion the monetary easing cycle has been already ended and the next change in rates will be a hike.
Earlier in the session, figures on net exports and government spending proved softer than expected. Net exports trimmed 0.2 percentage points from GDP in the third quarter. The drag came even as rising commodity prices helped sharply narrow the country's current account deficit to AUD 11.4 billion, from AUD 15.9 billion in the second quarter.
A report on Australia's GDP is due on Wednesday and there is a risk of a small contraction, the first since early 2011. That is why the AUD/USD may be under pressure in the coming hours. In our opinion this would be a good opportunity to open AUD/USD long. We think that commodity prices will become the dominant driver for AUD/USD again, leaving room for Aussie appreciation over the medium term
GrowthAces.com - Daily Forex Trading Strategies