In the domestic data front, the AIG Performance of Services index for the month of April fell to 44.1 from 49.6, while Producer Prices rose 0.3% QoQ during the first quarter and 1.6% over the last twelve months.
Against the backdrop of the RBA gathering next week, Analyst Adrian Foster at Rabobank commented, “I do expect one further rate cut this cycle but anticipate it being driven by CAPEX data as the RBA focuses on the economy transitioning away from mining to the non-mining sectors, rather than inflation data. Thus, I don’t see this rate cut coming next week”.
The cross is now advancing 0.06% at 1.0255 with the next resistance at 1.0292 (MA10d) followed by 1.0343 (MA55d) and finall7 1.0358 (MA21d).
On the downside, a breach of 1.0221 (low Apr.23) would expose 1.0202 (low Mar.11) and then 1.0188 (low Mar.5).