AUD/USD maintains the key level of 0.6400, the monetary policy of the RBA in the focus

• The AUD/USD is maintained above the 0.6400 key support level, while the US dollar operates with caution
• RBA is expected to reduce its OCR at 25 basic points to 3.85% on Tuesday.
• Investors expect the preliminary index data of the feeling of Michigan consumers in the US for May.

The AUD/USD torque is slightly above 0.6420 during European negotiation hours, but is within Thursday’s negotiation range. It is expected that the Australian pair operates laterally, since investors expect the decision on the interest rate of the Bank of the Australian Reserve, which will be announced on Tuesday.

According to a Reuters survey conducted from May 12 to 15, the RBA will reduce its official cash (OCR) rate to 25 basic points (BPS) to 3.85%. Analysts remain very confident in a

Anz Bank economists expect the RBA to reduce its OCR twice more in the remainder of the year. They have high confidence in greater relief of monetary policy by RBA due to pessimism over the business environment, despite the fact that the United States (USA) and China have agreed to reduce tariffs by 115% for 90 days.

“There are indications that some of those tariff ads are going to be reversed, but the big question is how this really affects consumer’s confidence and how companies feel … there is a clear weakness in the business environment, which would support a cut of rates by RBA next week,” said Madeline Dunk, an anz economist.

Since the Australian economy depends largely on its exports to China, a review in the Chinese economy influences the Australian dollar (Aud).

Meanwhile, the US dollar (USD) operates with caution before the preliminary index data of the feeling of Michigan consumers (CSI) for May, which will be published at 14:00 GMT. The feeling data is expected to be higher, reaching 53.4 from 52.2 in April, after having decreased for four consecutive months due to the one descaled in the commercial war between the US and China.