The Australian dollar dropped today following the release of unfavorable macroeconomic reports and continued to move down after the Reserve Bank of Australia made its monetary policy decision. The currency has come off the day’s lows by now, though it is still trading below the opening level.
Seasonally adjusted retail sales fell 0.5% in December from November, exceeding the median forecast of a 0.2% drop. The seasonally adjusted trade balance logged a surprise deficit of A$1.36 billion in December after posting a surplus of A$0.04 billion in November (revised from a deficit of A$0.63 billion).
The RBA left its main interest rate at 1.5%, matching market expectations. It added little to its statement. Prior to the meeting, some analysts were concerned that the bank would attempt to talk down the currency, which has rallied strongly since the mid-December. Yet the RBA did not add anything new about the exchange rate, just reminding that “an appreciating exchange rate would be expected to result in a slower pick-up in economic activity and inflation than currently forecast.”
AUD/USD was at about 0.7869 as of 10:35 GMT today after opening at 0.7879 and falling to the daily low of 0.7835. AUD/JPY declined from 85.97 to 85.70, and its daily low was at 84.99. EUR/AUD was up from 1.5699 to 1.5763, touching the high of 1.5795 — the highest level since February 2016.
If you have any questions, comments or opinions regarding the Australian Dollar,
feel free to post them using the commentary form below.
Be First to Comment