AUD/NZD zooms above 1.0550 as RBA maintains its status-quo

AUD/NZD prints substantial gains on Tuesday in the Asian session. The pair has been in continuous downside momentum for above one month, after making a high at 1.0824 on June 14.

At the time of writing, AUD/NZD is trading at 1.0563, up 0.06 % for the day.

A combination of factors weighing the performance of the Australian dollar against its counterpart. 

The Aussie remained in high spirits after the Reserve Bank of Australia’s (RBA) decision to keep the Official Cash Rate (OCR) unchanged at a record low of 0.10% at their August monetary policy meeting as widely expected.

The Central bank made no change in tapering stance and continue to purchase bonds at A$5 billion per week until early September before switching to A$4billion until mid-November.

The growing tensions between Australia and China remain another negative factor for the  AUD’s performance. In the recent development, China has accused Australia of vaccine shortage in Asia-pacific worsening the ties between the two largest trade partners.

The Job advertisements in Australia fell by 0.5% to 206,819 in July. This was the first drop in Jobs ads in the last 14 months whereas the Building Permits declined by 6.7% in June, a third straight month of fall.

Market participants remained cautious amid the worsening domestic coronavirus situation. Sydney has reported a record of coronavirus infections with the extension of lockdown until August 28th.

On the other hand, Kiwi gained on the better COVID-19 situation. There were no fresh cases recorded in the community as per the Ministry of Health.

In a statement on Tuesday, the Reserve Bank of New Zealand Governor Adrian Orr said that the rising housing prices pose threats to the economic recovery. The policymakers plan to further restrict high loan-to-value ratio lending to cool down the housing market.

AUD/NZD additional levels