AUD/USD continuing to drop following RBA minutes, China GDP

  • The Aussie is continuing to trip lower as bullish sentiment evaporates on RBA dovishness, miss for China GDP.
  • The AUD sees little meaningful data until Unemployment figures on Thursday.

The Aussie knocked lower in the Tokyo trading session, hitting the 0.7760 level after being driven lower by a flatlining Reserve Bank of Australia (RBA) Meeting Minutes report.

RBA minutes: Board agreed there was not a strong case for near-term move in policy

Further adding to the AUD/USD's lack of motivation was China's GDP figures, which showed a small but worse-than-expected decline in the quarter-on-quarter figures and missed expectations, although the year-on-year figures balanced with a small beat on the forecast 6.7 percent. As noted earlier, "the world's second-largest economy expanded 6.8 percent year-on-year in the first quarter, beating the estimated slowdown to 6.7 percent, the official data showed. However, the industrial production printed at 6% year-on-year in February vs 6.2 percent expected. Meanwhile, consumption, as represented by retail sales, increased 10.1 percent, beating the estimate of 9.9 percent and up from the previous month's print of 9.7 percent. The currency pair will likely remain under pressure in Europe as traders may price-in the delay in RBA tightening. Also, action in the equity markets could influence the Aussie dollar."

AUD/USD Levels to watch

As FXStreet's own Omkar Godbole stated earlier, "acceptance below the 5-day moving average (MA) lined up at 0.7762 could yield a deeper drop to 0.7733 (10-day MA) and possibly to 0.77 (psychological support). On the higher side, a convincing break above 0.7791 (100-day MA) would expose the 200-day MA of 0.7814. A close higher would signal an upside break of the falling channel and allow stronger rally towards 0.7916 (March 14 high).

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