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RBA holds rates, euro firms, as EUR/AUD eyes triangle breakout
The RBA kept its cash rate at 4.35% and signaled inflation risks remain, while EUR/AUD traded near a seven-week high around $1.155.
Action Forex reports the RBA held its cash rate steady at 4.35%, citing a softer June headline inflation print of 3.8% versus expectations. Even so, the central bank’s statement was cautious, warning trimmed mean inflation remains elevated and largely unchanged from the March quarter, with oil and related commodities still above pre-conflict levels amid the Middle East crisis.
On the euro side, the outlet said EUR/AUD retained a cautiously bullish tone after the euro climbed to a seven-week high near $1.155 against the dollar. It pointed to eurozone Q2 growth of 0.4% for support, while noting weaker retail activity and mixed inflation signals are leaving the ECB’s path uncertain.
Action Forex added that the ECB is maintaining a deliberately cautious stance ahead of its September 15 to 16 meeting, without giving a firm commitment to further hikes. The net result is described as “holding patterns” for both central banks, each leaving the door open to more tightening while waiting for clearer data.
Technically, the article said EUR/AUD has rallied from July lows near 1.6243 and is now compressing into a symmetrical triangle as two trendlines converge around the 0.5 to 0.618 Fibonacci zone near 1.6342 to 1.6372. It outlined that a break above the descending trendline could target moves toward 1.6402 and possibly a retest of the 1.6500 highs, while a breakdown could expose 1.6341, then 1.6298 and a potential retest of 1.6243.