Following a decline spurred by US Dollar buying, the Aussie has sprung back heading into European markets, currently testing just below 0.7930.
With the USD climbing against the bloc of major currencies during Asia. AUD/USD has since pushed back, erasing the session losses and is now posting a gain heading into European trading. Markets have absorbed the Reserve Bank of Australia's (RBA) recent meeting minutes which stated that the central bank expects inflation growth to be subdued, but ongoing, and have responded by buying up the AUD once more.
The real test for the Aussie will come on Wednesday, when the wage growth figures drop at 00:30 GMT. With high household debt and a lack of momentum in wage growth, any positive sign would be a benefit for the Aussie right now, with several key headwinds keeping the Australian economy on a slower growth track than the rest of the world.
AUD/USD Technicals
The pair is still trading above the 34 EMA on Daily charts, but bullish momentum is constrained, and the pair continues to languish below the recent high of 0.8135 that was reached in March. Bearish action will face support from 0.7907, 0.7866, and 0.7837, while bullish momentum will need to contend with the recent swing high at 0.7988 if a run up the charts is to materialize.
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