The Australian Dollar comfortably holds above the key support level at US$0.7690 as market participant remain focused on today’s (May) Reserve Bank of Australia (RBA) interest rate decision that expects the RBA to keep the cash rate and other key measures at a record low 0.1%.
At present, it is widely expected there will be little chance the central bank will change course on its interest rate outlook in light of last week’s inflation figures, which showed price pressures remain extremely subdued.
The central bank has repeatedly said it has no intention of lifting interest rates until inflation is sustainably within the 2% to 3%e target band.
The statement will be closely scrutinised to see if the tone holds to a hawkish or dovish bias.
Meanwhile, Australia’s headline Trade Balance for March dropped below 7529M prior and 8000M market consensus to 5574M.
Details suggest that the Imports eased from 5.0% to 4.0% whereas Exports flashed -2.0% against -1.0% previous readouts in the latest update.
Technically, a New York close beneath US$0.7690 would reinstate the bearish sentiment to US$0.7625-35. Reassess from there.
The resistance remains at US$0.7815 and seen as a near-term cap which expects another bearish ambush if contested, with the immediate resistance located at US$0.7765.