Australian Dollar Reverses Gains After RBA Stands Pat

The Australian dollar attempted to rally intraday but halted its advance after the Reserve Bank of Australia announced its monetary policy decision.
The RBA kept its main interest rate at 1.5%, as was widely expected. The central bank predicted that the Australian economic growth will pick up to a bit above 3% in 2018 and 2019. The bank also mentioned that “employment has grown strongly over the past year” but “inflation remains low.” Overall, the statement again suggested that the RBA is not in a hurry to start raising interest rates.
As for macroeconomic data released from Australia today, it was not helpful to the currency either. The Australian Industry Group Australian Performance of Manufacturing Index dropped from 63.1 to 58.3 in April. Nevertheless, the index remained comfortably above the 50.0 level of no change, and the report said that the rate of expansion was “still buoyant.” The RBA Index of Commodity Prices fell 1.4% in April, on an annual basis, after declining 2.8% in March.
AUD/USD was up from 0.7528 to 0.7546 intraday but retreated to 0.7509 by 11:16 GMT today. EUR/AUD traded at about 1.6018 after opening at 1.6029 and falling to the daily low of 1.5998. AUD/JPY was at 82.34 following the earlier rally from 82.31 to 82.53.

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