AUD/USD drops 60 pips as Westpac forecasts RBA rate cut

AUD/USD has dropped from 0.7207 to 0.7142 in the last 60 minutes, possibly on Westpac's RBA rate cut call.
Westpac now expects the central bank to cut rates in August and November.

Omkar Godbole FXStreet Contributor

The Aussie dollar is being offered across the board, possibly due to an RBA rate cut call by Westpac - one of Australia's leading banks.

There is a strong case for interest rate cuts, as the economic slowdown could push up the jobless rate to 5.5 percent by the end of 2019, according to Westpac. The lender, therefore, expects the Reserve Bank of Australia (RBA) to cut rates by 25 basis points in August and November this year.

With the rate cut forecast, Westpac has ditched its long-held view that the central bank would remain on hold for a long time.

AUD/USD, which had jumped to highs above 0.72 on the back of stellar January jobs report, is now reporting losses at 0.7150. The currency could slide further on rising odds of an early RBA rate cut.

Technical Levels

1. R3 0.7226
2. R2 0.7204
3. R1 0.7184
PP 0.7162
1. S1 0.7142
2. S2 0.712
3. S3 0.71

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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