AUD/NZD refreshes four-month low below 1.0700 after RBA continues steady policy

AUD/NZD drops and prints a fresh four-month low at 1.0680 as RBA kept doors open for further interest rate hikes.
The RBA kept interest rates steady at 4.10% as expected by market participants.
On Wednesday, the RBNZ is expected to keep interest rates steady at 5.5%.

Sagar Dua FXStreet

The AUD/NZD pair printed a fresh four-month low at 1.0680 on Tuesday after the Reserve Bank of Australia (RBA) announced an unchanged interest rate decision. The maintenance of a status quo from RBA policymakers was anticipated by market participants.

In August, the Australian Consumer Price Index (CPI) accelerated to 5.2% on a monthly basis from the 4.9% reading in July due to rising fuel prices. The impact of higher energy prices was limited as RBA policymakers considered core inflationary pressures for policymaking. This allowed the RBA to keep interest rates unchanged at 4.10% for the fourth time in a row.

As inflation is more than double the required rate, RBA Governor Michele Bullock left doors open for further policy tightening. Bullock cited that inflation has come down from its peak but is still too high and the achievement of price stability in a reasonable timeframe is the board’s priority.

Last week, a poll from Reuters showed that the RBA will keep interest rates unchanged but one hike of 25 basis points (bps) is possible, which will push interest rates to 4.35%.

About the economic outlook, RBA's Bullock remains upbeat citing that inflation is coming down, the labor market remains strong and the economy is operating at a high level of capacity utilization.

On the New Zealand front, investors await the monetary policy from the Reserve Bank of New Zealand (RBNZ), which will be announced on Wednesday. RBNZ Governor Adrian Orr is expected to deliver a neutral interest rate policy. The next monetary policy meeting in November is going to be crucial as policymakers will have inflation figures for the July-September quarter.

AUD/NZD

Overview
Today last price	1.07
Today Daily Change	-0.0002
Today Daily Change %	-0.02
Today daily open	1.0702

Trends
Daily SMA20	1.0826
Daily SMA50	1.0827
Daily SMA100	1.0834
Daily SMA200	1.0825

Levels
Previous Daily High	1.0744
Previous Daily Low	1.0692
Previous Weekly High	1.0816
Previous Weekly Low	1.0718
Previous Monthly High	1.0919
Previous Monthly Low	1.0718
Daily Fibonacci 38.2%	1.0712
Daily Fibonacci 61.8%	1.0724
Daily Pivot Point S1	1.0681
Daily Pivot Point S2	1.066
Daily Pivot Point S3	1.0629
Daily Pivot Point R1	1.0734
Daily Pivot Point R2	1.0765
Daily Pivot Point R3	1.0786

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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