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AUD/NZD slips after RBA keeps its cash rate at 4.35%
AUD/NZD was around 1.1960 in Asian trading as the RBA left the Official Cash Rate unchanged for a second straight meeting and attention turned to August policy communications.
AUD/NZD pared its daily gains and traded around 1.1960 during Asian hours on Tuesday, after the Reserve Bank of Australia kept the Official Cash Rate unchanged.
According to FXStreet, the RBA left its key rate at 4.35% for a second consecutive meeting, following second-quarter inflation that came in lower than projected. Market participants now focus on the RBA’s August Statement on Monetary Policy for signals on the bank’s inflation and growth outlook.
FXStreet also noted that views on the Australian Dollar carry are likely to hinge on how long the RBA can sustain its current hawkish stance. In the background, FXStreet pointed to rising oil prices tied to uncertainty over the potential reopening of the Strait of Hormuz, which is adding complexity to expectations for the Reserve Bank of New Zealand’s September decision.
FXStreet said markets are exercising caution ahead of New Zealand’s third-quarter inflation expectations, especially after Q2 data showed an unexpected acceleration, while political uncertainty in New Zealand has added to the broader regional risk tone.