22 Jul 2015
AUD/USD pares losses, regains 0.7400 post RBA Stevens
FXStreet (Mumbai) - The Australian dollar tries to fight back lost ground and recovers half its slide versus the US dollar in the mid-Asian session, now lifting AUD/USD back above 0.74 handle, as markets digest the latest Reserve Bank of Australia (RBA) Governor Glenn Stevens speech delivered at the Anika Foundation Luncheon, in Sydney on Wednesday.
AUD/USD recovers from 0.7373 dip
Currently, the AUD/USD pair trades -0.15% lower at 0.7408, having posted fresh session lows of 0.7373 shortly after RBA Stevens remarks. The Aussie tries very hard to reclaim footing and swung back higher above 0.74 handle after markets viewed RBA Stevens speech as somewhat positive, especially his comments on the AUD and its impact on the country’s growth.
Stevens said in his speech that the weaker Australian dollar was having an "expansionary effect" on the economy. "That is why we have felt that, on balance, a somewhat lower exchange rate was likely to be a part of the necessary adjustment. That adjustment seems to be occurring, with relatively little disruption, and is having an expansionary effect."
Earlier in the session, the Aussie was bolstered and spiked to 0.7439 high following upbeat Australia’s CPI data which showed that last quarter the CPI rose 0.7% after fuel prices were lifted back almost to levels seen before the drop in global oil prices last year. This follows a mere 0.2% rise in the two preceding quarters when the drop in fuel prices hit hardest on inflation.
Meanwhile, the pair may remain influenced by USD moves ahead of existing home sales data from the US due later in the day.
AUD/USD Technical Levels
The pair has an immediate resistance at 0.7439 (Today’s High) levels, above which gains could be extended to 0.7489 (July 15 High) levels. On the flip side, support is seen at 0.7341 (Today’s Low) levels from here it to 0.7326 (July 20 Low) levels.
AUD/USD recovers from 0.7373 dip
Currently, the AUD/USD pair trades -0.15% lower at 0.7408, having posted fresh session lows of 0.7373 shortly after RBA Stevens remarks. The Aussie tries very hard to reclaim footing and swung back higher above 0.74 handle after markets viewed RBA Stevens speech as somewhat positive, especially his comments on the AUD and its impact on the country’s growth.
Stevens said in his speech that the weaker Australian dollar was having an "expansionary effect" on the economy. "That is why we have felt that, on balance, a somewhat lower exchange rate was likely to be a part of the necessary adjustment. That adjustment seems to be occurring, with relatively little disruption, and is having an expansionary effect."
Earlier in the session, the Aussie was bolstered and spiked to 0.7439 high following upbeat Australia’s CPI data which showed that last quarter the CPI rose 0.7% after fuel prices were lifted back almost to levels seen before the drop in global oil prices last year. This follows a mere 0.2% rise in the two preceding quarters when the drop in fuel prices hit hardest on inflation.
Meanwhile, the pair may remain influenced by USD moves ahead of existing home sales data from the US due later in the day.
AUD/USD Technical Levels
The pair has an immediate resistance at 0.7439 (Today’s High) levels, above which gains could be extended to 0.7489 (July 15 High) levels. On the flip side, support is seen at 0.7341 (Today’s Low) levels from here it to 0.7326 (July 20 Low) levels.