The AUD/USD is trading at $0.9231, down 0.2%, as traders secure their profits from the end of last week’s gains. For the year-to-date, the Australian dollar is up 3.8% against the US dollar. As Evan Lucas stated, the Reserve Bank of Australia (RBA) has shifted its viewpoint from easing its monetary policy to a more neutral stance.
Last year the RBA cut interest rates to an all-time low of 2.5%. The governor, Glenn Stevens, has decided to wait and see, holding off further interest rate reductions until he sees additional signs of a slowdown. Last week Mr Stevens stated Australia could be in for a property boom given the low interest rates and a strong construction sector would help Australia reduce its dependence to importing Chinese minerals.
The RBA is likely to keep interest rates unchanged. If Mr Stevens retains his neutral stance in his statement, we could see the Australian dollar test the $0.93 mark. The Aussie is finding support at the 100-period moving average of $0.9226.