AUD/USD and NZD/USD Fundamental Daily Forecast – Traders Looking for RBA Comments on GDP Growth Forecast
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The Australian Dollar posted a small gain against the U.S. Dollar as investors positioned themselves ahead of Tuesday’s Reserve Bank of Australia Monetary Policy Meeting Minutes and Wednesday’s U.S. Federal Reserve interest rate decision and economic projections.
The AUD/USD settled at .7717, up 0.0007 or +0.09%.
The RBA will release the minutes from its March 6 monetary policy meeting at 0030 GMT. At the meeting, the central bank maintained its benchmark cash rate at the record low 1.50 percent.
There were very changes in the last monetary policy statement. However, the central bank did change its comments on GDP.
Traders will be looking for any expanded talk on why the March statement changed its Australian GDP growth forecast from “growth to pick up, to average a bit above 3 percent over the next couple of years” to a seemingly less bullish “grow faster in 2018 than it did in 2017.”
We’re likely to see a subdued response to the RBA minutes with traders quickly shifting their focus to the U.S. Federal Reserve meeting on Wednesday.
The Federal Open Market Committee, the central bank’s policy-setting group, is widely expected to raise its benchmark interest rate 25-basis points from 1.50 percent to 1.75 percent. However, traders are more interested in the Fed’s economic projections. They are speculating on whether the Federal Reserve would signal more aggressive rate hikes this year. Traders said the Fed could become more aggressive in response to a tightening labor market.
The trend is down on the daily chart so any rally will be driven by short-covering. The key upside target is .7743. A sustained move under this level will signal the presence of buyers. Overcoming this level will indicate profit-taking and aggressive position-squaring. I don’t expect to see a change in trend over the near-term.
This article was originally posted on FX Empire