Flash: RBA – how credible is intervention? – Rabobank

FXstreet.com (London) - Jane Foley, Senior Currency Strategist at Rabobank noted the href="">AUD has lost over 2% vs. the USD since the middle of last week.

Key Quotes:

“AUD has lost over 2% vs. the USD since the middle of last week following the warnings from RBA Governor Stevens that he wouldn’t “eschew” currency intervention”.

“The active distortion of market forces is not the favoured policy of G10 central banks”.

“…desperate times require desperate measures and the rong>RBA is currently sandwiched between the real economy’s need for loose monetary conditions and the fear that lower interest rates could further boost household borrowing”.

“Given the move in recent days, we would question the ability of >AUD/USD to fall much further on the risk of intervention near-term and expect some bargain hunting to lend support”.

“This morning’s low at >AUD/USD0.9120 is likely to offer technical support near-term”.