The AUD/USD is a little higher after the RBA released the speech from Dep Governor Debell, which wasn’t as dovish as some were anticipating.

Debell, it was thought, could possibly talk about the need for a rate cut, but as it happens, no such talk was remotely in the picture.

In fact, it looks as though he was quite positive on the outlook and wanted to take more of a wait and see approach. This is really in-line with the RBA. But like I said, given his stance as a dove it is only natural to expect some sort of talk of weakness and possible cuts. But not to be.

The AUD/USD is now higher on the session and back in the green. We had seen some selling coming into the speech, in expectation of some potential downside here.

Key Highlights

• Jobs growth is strong and at odds with other areas of the economy.
• Waiting to see which one of these areas wins out in the months ahead.
• Slow consumption growth
• Current lending and mortgage rates are very low
• Really do need to see higher wages to boost CPI
• China slowdown having a bigger impact than expected
• Waiting to get a read on CPI in the coming months to better judge

Bottom Line: Given that the AUD/USD was falling, there might be some trapped shorts here. Look for a bit of upside, but generally, this should be considered nothing all that new.