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AUD / USD appears to close modestly higher, holding below 0.7050 as focus shifts to RBA

  • AUD / USD appears to break the four-day losing streak on Monday.
  • The RBA is expected to reduce its policy rate to 0.1%.
  • The dollar remains resilient ahead of the US presidential election.

The pair AUD/USD It started the new week quietly and rose with risk flows, helping the risk-sensitive AUD gain traction against its rivals. However, after hitting a fresh daily high of 0.7054, the pair appears to have entered a consolidation phase as investors shift their focus to the Reserve Bank of Australia (RBA) policy announcements. At the time of writing, the AUD/USD it was up 0.2% on the day at 0.7040.

Upcoming key events for AUD / USD

In the early trading hours of the Asian session, the RBA is expected to lower its policy rate to 0.1% from 0.25%. Some experts also believe that the RBA could extend its quantitative easing by A $ 100 billion.

In anticipation of this event, “if the RBA does not match expectations with the scope of easing measures, there may be room for a relief rally for AUD / USD,” Rabobank analysts said. “That said, due to its gas exports, the AUD cannot escape being pegged to the price of oil, which is under pressure from fears of a drop in demand. New headlines referencing the AUD are also weighing on the AUD. to the tensions between Australia and China “.

With the RBA out of the way, investors will turn their attention to the US presidential election. Meanwhile, the US Dollar Index was up 0.32% on the day to 94.18, signaling a cautious mood in the market despite strong gains seen in major Wall Street indices.

Earlier in the day, data released by the ISM and IHS Markit showed that business activity in the manufacturing sector continued to grow at an impressive rate in October, but was largely ignored by market participants.

Credits: Forex Street

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