The AUD/USD has reacted to the upside after the Bank of Australia’s (RBA) Reserve Bank’s (RBA) monetary policy announcement. The pair has tested daily lows previously reached in the Asian session at 0.7736 at the time of the announcement, but was immediately up 30 pips thereafter, rising to around 0.7765 / 70, not far from the daily high of 0.7776. At time of writing, the pair is trading above 0.7766, shedding 0.08% daily.
At its meeting today, the Reserve Board of the Bank of Australia decided to keep the current policy setup, including the 0.10% interest rate, as expected.
The statement highlighted that in Australia, the economic recovery is well advanced and has been stronger than expected. The recovery is expected to continue, and the central scenario is that the GDP grow 3.5% in both 2021 and 2022. GDP is expected to return to its level at the end of 2019 in the middle of this year.
However, the Board confirmed that it will not increase the cash rate until real inflation is sustainably within the target range of 2% to 3%.. For this to happen, wage growth will have to be materially higher than it is today. This will require significant gains in employment and a return to a tight job market. Board you do not expect these conditions to be met until 2024 at the earliest.
AUD / USD levels
Without notable data for the remainder of the day, the operators of the crossing will be aware of market sentiment and digest the RBA announcement.
To the upside, the first notable resistance appears at 0.7787, Monday March 1 high. Above 0.7800, the next target is 0.7900 before hitting the strong barrier 0.8008, the top of February 25 and the last three years.
On the downside, the initial support is at 0.7720, ground yesterday, March 1. A break below could lead to 0.7691, the low of February 26 and the last three weeks.
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
