On Tuesday, the centre of attention for traders is the Australian currency. Before the RBA published their interest rate decision, the Aussie dollar was trading at 0.7680 against its American counterpart, having gained some strong support from strong retail sales data for May. Then, it became clear that the RBA would keep interest rates at their current level of 1.5%. On this news, the AUDUSD pair fell 60 pips to 0.7621. Following the Aussie’s lead, the pound and both euro also fell against the US dollar.
Market participants didn’t like the RBA’s rhetoric. The regulator made clear that the current parameters of the bank’s monetary policy are working fine in terms of reaching their targets and that an increase in value for the Aussie dollar now would complicate the process of readjusting the economy.
In the space of 4 hours, the Aussie has fallen by 90 pips. The euro/dollar rate fell by 36 pips to 1.1336, after which it quickly recovered all its losses. The GBPUSD rate hit a new low after a weak construction PMI report from the UK. The dollar is currently growing across the market. At the time of writing this review, the euro is trading at 1.1345 while the pound is at 1.2931.
The US is celebrating Independence Day today. The economic calendar is empty. Because of this, the majors could keep trading at their current level until trading opens in Europe on Wednesday, with about 20-25 pips give and take. A support for the euro/dollar runs through 1.1330 and for the pound/dollar at 1.2915.