Australian Dollar Mute On Dovish RBA Board Minutes

By Eric Andersen,

THE TAKEAWAY : RBA Board Minutes Lack Enthusiasm for Economic Growth > Dovish Outlook Affirms Chance of Expected Rate Cut > AUDUSD Falls

Monetary policy meeting minutes released by the Reserve Bank of Australia portray a Board markedly reserved in regard to Australia’s economic outlook. With regard to international conditions, governors noted “ongoing weakness in Europe,” a slowing Chinese growth, falling terms of trade, and concerns that higher oil prices will negatively affect supply. Domestically, board members emphasized mixed business activity indicators, modest export growth, a subdued labor market, and a weak housing market. Overall, the Board stated that, in the event of moderating inflation during the coming period, “then a case could be made for further easing of monetary policy.” However, the RBA will wait for the Aussie CPI data’s release on April 24 th before making a decision regarding its cash rate.

Following the release, which was widely expected to be dovish in tone, traders initially sold, then repurchased the Aussie dollar. The AUDUSD fell from 1.0340 to as low as 1.0330, and then rose up to 1.0350.
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Original Article: http://www.dailyfx.com/forex/market_alert/2012/04/17/Australian_Dollar_Mute_on_Dovish_RBA_Board_Minutes.html

DailyFX is the forex news and research arm of FXCM (NYSE: FXCM), which provides currency trading and brokerage services and is an advertiser on TheStreet websites. Any opinions, news, research, analyses, prices, or other information is provided as general market commentary, and does not constitute investment advice. Dailyfx will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. Currency trading involves significant risk of loss. Individual authors may hold positions in the currencies discussed in the article.