AUD/USD has edged lower in Tuesday trading, as the pair trades in the mid-92 range late in the European session. In economic news, the RBA held interest rates at 2.50%. In the US, today's highlight is ISM Manufacturing PMI.
As expected, the RBA maintained the benchmark interest rate at 2.50%, where it has been pegged since last August. RBA Governor Glenn Stevens took a swipe at the Aussie, saying that the high value of the currency in the past few months was not good for economic growth. After the rate decision, the Australian dollar briefly pushed above the 0.93 line, its highest level in four months. Last week, Stevens said that interest rates are unlikely to rise in 2014, as the RBA tries to boost consumer spending and residential construction. On the release front, Australian HIA New Home Sales started off the new week on a high note, as the indicator jumped 4.6% last month, a three-month high.
On Monday, Fed chair Janet Yellen said that "considerable slack" remained in the US economy and this would require further stimulus measures. Currently, the Fed is purchasing $55 billion in assets under its QE scheme. There have been three tapers to QE so far, and Yellen plans to wind up the program in the fall, provided that the US economy does not run into any serious turbulence. At the same time, the Federal Reserve has stated that its has no plans to raise interest rates until sometime in 2015.
AUD/USD 0.9239 H: 0.9302 L: 0.9230
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