The Australian dollar is trading at around US87.00 cents today down from yesterday’s close of US87.17 cents after the RBA said that Intervention to bring the currency lower could not be ruled out.
RBA assistant governor Christopher Kent stated intervention to bring down the “too high” exchange rate was not off the table.
“He mentioned that “its above most estimates of its fundamental value, particularly given the substantial declines in commodity prices over the course of this year”.
Industrial production figures from China today came in at 7.7% against a consensus of 8% and once again showing that there are cracks appearing in the Chinese economy. This doesn’t hold well for the Aussie dollar because any slowdown in the Chinese economy is going to have a knock on affect in Australia as China is the country’s biggest trading partner.
“A continuation of such poor data can only pressure the Aussie dollar,” claim analysts at Fibogroup
“Any slowdown in China will only reduce demand for Imports into the country which Includes Australia’s largest export Iron ore which is already sitting at a six year low”
Recommended Content
Editors’ Picks
EUR/USD consolidates weekly gains above 1.1150
EUR/USD moves up and down in a narrow channel slightly above 1.1150 on Friday. In the absence of high-tier macroeconomic data releases, comments from central bank officials and the risk mood could drive the pair's action heading into the weekend.
GBP/USD stabilizes near 1.3300, looks to post strong weekly gains
GBP/USD trades modestly higher on the day near 1.3300, supported by the upbeat UK Retail Sales data for August. The pair remains on track to end the week, which featured Fed and BoE policy decisions, with strong gains.
Gold extends rally to new record-high above $2,610
Gold (XAU/USD) preserves its bullish momentum and trades at a new all-time high above $2,610 on Friday. Heightened expectations that global central banks will follow the Fed in easing policy and slashing rates lift XAU/USD.
Week ahead – SNB to cut again, RBA to stand pat, PCE inflation also on tap
SNB is expected to ease for third time; might cut by 50bps. RBA to hold rates but could turn less hawkish as CPI falls. After inaugural Fed cut, attention turns to PCE inflation.
Bank of Japan set to keep rates on hold after July’s hike shocked markets
The Bank of Japan is expected to keep its short-term interest rate target between 0.15% and 0.25% on Friday, following the conclusion of its two-day monetary policy review. The decision is set to be announced during the early Asian session.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.