AUD/USD: Capped and eyes now on the 21-DMA

Capped on the upside, bears aim for the 21-Day moving avrage but, AUD/USD is flat in the open, having risen from 0.6830 to 0.6858 (a one-month high) on Friday, opening at 0.6845 within a 10 pip range.

The Aussie rode the waves last week unemployment drop and the Brexit-related bounce spurred on risk positive sentiment,  making a marginal new 1 month high at 0.6839. 

"There was little reaction to RBA governor Lowe’s upbeat tone from the IMF meetings in Washington DC but pricing for a Nov rate cut was lower than as of late Thursday, which helps AUD," analysts at Westpac explained. 

RBA in focus

RBA's Govenor Lowe spoke at an IMF forum in Washington and came across more upbeat, essentially downplaying the odds of the RBA needing to cut stating "I don't think it's the right assumption to make that we're going to have a lot more work to do to get inflation back to target and growth back to trend."

Additionally, he said "Actually, the economy has been through a soft patch over the last year but it's actually gradually improving," he said. On non-conventional monetary policy he said, "I'm not going to speculate on negative interest rates and quantitative easing in Australia, other than to say negative interest rates are extraordinarily unlikely in my country."

AUD/USD levels