On the back of the RBA and Governor Lowe turning dovish in his speech, the Aussie economy has taken another hit.

In its SOMP, the RBA has come out and significantly lowered its GDP forecasts to 2.5% from 3.25%.

That’s a huge cut by anyone’s standards and is a reflection on the poor state of the economy at the moment.

Clearly, that reinforces the dove case for a rate decrease later in the year and that is the type of action we are seeing on the ASX and with the AUD/USD.

Aussie Outlook

The AUD/USD is under the major level at 0.7100 and is down -0.50% on the session with sellers stepping up.

0.7050 and then 0.7000 are my next two key support levels below, with 0.7100 turning into key resistance.

0,7200 is R1 and 0.7300 is R3 and the most recent highs sitting at 0.7400.