Aussie Falls As Minutes Indicate RBA's Preparedness To Act On Worsening Of Outlook
August 17 2021 - 12:05AM
RTTF2
The Australian dollar slipped against its most major
counterparts in the Asian session on Tuesday, after minutes from
the Reserve Bank of Australia's August meeting showed that the
Board is prepared to act if the recent surge in delta virus strain
threaten the country's economic recovery.
Policymakers of the RBA said the economic activity and
employment were expected to decline in the September quarter as the
high transmissibility of the Delta variant raised the possibility
of a more gradual reopening, minutes from the central bank's August
3 meeting showed.
The board said outbreaks of the Delta variant and accompanying
lockdowns had introduced a high degree of uncertainty to the
outlook for the second half of 2021.
The current virus outbreaks and lockdowns had interrupted the
recovery and many households and businesses were facing difficult
conditions, the minutes said. Members therefore considered the case
for delaying the tapering of bond purchases to A$4 billion a week
currently scheduled for September 2021.
"The Board would be prepared to act in response to further bad
news on the health front should that lead to a more significant
setback for the economic recovery," the minutes added.
Asian shares are mostly lower, with a steep drop in crude oil
prices and the surge in the spread of the delta variant of
coronavirus and the resultant restrictions in several countries as
well as disappointing Chinese economic data and geopolitical
concerns weighing on investor sentiment.
The aussie weakened to near a 9-month low of 0.7278 against the
greenback and near a 7-month low of 79.44 against the yen, off its
early highs of 0.7341 and 80.25, respectively. The currency is
likely to find support around 0.70 against the greenback and 78
against the yen.
The aussie dropped to a 4-day low of 0.9189 against the loonie
and a fresh 2-week low of 1.6162 against the euro, after rising to
0.9228 and 1.6037, respectively in early deals. The aussie is seen
finding support around 0.90 against the loonie and 1.64 against the
euro.
In contrast, the aussie rose to a 2-week high of 1.0541 against
the kiwi, after touching 1.0420, which was its lowest level since
November 30, 2020. The aussie may challenge resistance around the
1.07 mark.
Looking ahead, Eurozone construction output for June, GDP and
employment data for the second quarter are set for release in the
European session.
Canada housing starts for July are scheduled for release at 8:15
am ET.
U.S. NAHB housing market index for August, business inventories
for June, retail sales and industrial production for July will be
featured in the New York session.
AUD vs US Dollar (FX:AUDUSD)
Forex Chart
From Mar 2024 to Apr 2024
AUD vs US Dollar (FX:AUDUSD)
Forex Chart
From Apr 2023 to Apr 2024