It’s another big day for the Australian dollar as it awaits the release of economic growth figures and a speech by RBA Governor Stevens. Yesterday’s monetary policy meeting at the RBA proved to be largely a non-event for the aussie, but widespread USD strength has weakened AUDUSD.
Today, the market is focused on Australia’s Q2 GDP numbers which are due out shortly (0130GMT). The current consensus estimates put the headline growth figure at 0.4% over the quarter. However, some analysts have revised their forecasts higher after last week’s strong CAPEX report and other economic data, and we also think the market may be pleasantly surprised by today’s GDP data.
In regards to policy, the RBA won’t be surprised by a growth rate around 0.4% last quarter, which should put overall growth somewhere around 3.0% y/y. If the number is higher than expected we expect to see a positive reaction from the Australian dollar, although the RBA may attempt to downplay it. -
It’s unclear if Stevens will talk about today’s GDP data during his speech in Adelaide at around 0330GMT, but he may touch on it given that he is speaking to the Committee for Economic Development of Australia. If he does, he may attempt to downplay a better than expected number by talking down the Australian dollar. Obviously, this is pure speculation.
AUDUSD
AUDUSD remains trapped in a medium-term trading range, with resistance around 0.9375 and support around 0.9235. At this point it looks like the pair could test the bottom of the aforementioned trading range, but in the absence of a major shock from today’s GDP data or Stevens or a big USD move, it’s unlikely the pair will be able to break this level in the short-term.
Source: FOREX.com
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