Last week the Australian money, or AUD, fought to gain in sessions before the RBA announcement this week. Reserve Bank of Australia governor Philip Lowe shocked the market last week when he said the Australian economy is at a “gentle turning point.”
The confusing messages about the direction of the monetary policy in Lowe’s remarks helped support the demand for the AUD. His unexpected optimistic attitude suggested another interest rate cut for the Australian money tomorrow.
However, Lowe also said that it was a priority for the RBA to prevent the exchange rate from appreciating. Thus, some critics believe that the third interest rate cut will be by 25 basis points.
Meanwhile, traders are also monitoring the highly susceptible New Zealand dollar this week. Last week, the AUD and NZD traders were worried about the Chinese PMIs and their effect on the currencies.
Investors are also closely eyeing signs whether the Reserve Bank of New Zealand will follow the path of the RBA. The rate cut for November’s meeting could be tempered if the kiwi gets hurt from the Australian money.
The Australian money ended its run on a positive note as it gained against other major forex players in sessions. The AUD pushed the greenback, single currency, pound sterling, and kiwi into negative territories.
The AUD USD gained 0.27% or 0.0019 points in sessions and has recorded levels between $0.6744 and $0.6766 last Friday. While the EUR AUD trading pair declined 0.012% or 0.0020 points, hitting ranges from AU$1.6137 to AU$1.6198 on the trading session.
The GBP AUD exchange rate also went down 0.28% or 0.0051 in sessions, trading around AU$1.8156 to AU$1.8289 on Friday.
Last week, the AUD NZD trading pair rallied 0.28% or 0.0030 points and has exchanged from NZ$1.0712 to NZ$1.0749.