The Australian dollar is trading at $0.9231, up 0.78%, after an upbeat outlook from the Governor of the RBA. Mr Stevens is trying to refocus the Australian economy away from mining, as it is heavily reliant on Chinese growth, and is trying to encourage domestic business. In his statement, Governor Stevens stated a strong domestic economy and relatively low interest rate could lead to growth in the construction sector.
As Chris Weston stated, the AUD/USD was eyeing up the 200-day moving average ($0.9129) earlier today and has now broken through it. The Australian dollar is now at a four-month high versus the US dollar.
The update from the RBA wasn’t all positive, as Mr Stevens warned that the Aussie was still too high which could lead to interest rate cuts in the second half of the year. The 50-week moving average of $0.9263 is acting as resistance; if we fail to break that level we could drift lower because of profit-taking.