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AUD/USD holds above 0.7060 after RBA leaves rates unchanged
The RBA kept the cash rate at 4.35%, while the US Dollar Index stayed flat as ADP data and shipping tensions helped limit USD movement.
AUD/USD moved modestly higher above the 0.7060 area after the Reserve Bank of Australia left interest rates unchanged at 4.35% in a unanimous August decision, according to FXStreet. RBA Governor Michelle Bullock said the RBA will raise rates again if needed, and she hopes to see progress before becoming confident about Consumer Price Index outcomes.
On the US side, FXStreet pointed to ADP’s Employment Change 4-week average, which showed the private sector added 8.25K jobs for the week ending July 25, below the prior revised 11K figure. Despite the softer ADP reading, the US Dollar Index was described as flat amid ongoing reports of disruptions around the Strait of Hormuz, including reports that US forces fired on a Panama-flagged ship after it allegedly ignored warnings while attempting to breach an American blockade of Iranian ports.
Standard Chartered, as cited by FXStreet, said its base case remains for no more RBA rate hikes in the foreseeable future, but it warned the risks are not fully one-sided. The bank cautioned the balance of risks leans toward a potential Q4 hike if demand does not slow enough or if energy prices return to recent highs, which could worsen capacity and price pressures.
FXStreet also noted technical levels for AUD/USD, with the pair around 0.7069 and holding above the 20-period and 100-period simple moving averages. Resistance was identified near 0.7070 and 0.7074, while support was flagged around 0.7062 and 0.7055.
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