RBA’s Lowe is Bullish on the Aussie Economy: AUD
The RBA Governor Lowe has been speaking this morning in Australia and has been sounding more and more confident of the state of the economy.
While some might say he is being a little overconfident, he has made a fair few points that are certainly bullish on the outlook of the economy.
Despite some mixed data in recent weeks, including a very soft retail sales figure, Lowe was confident that consumers spending would once again return to lift the economy.
He also stated that GDP was in line with expectations. If you recall, there was a strong YoY figure, but a bit of a softer quarterly number.
Lowe has shaken off both of these things and is confident that consumers will come back to the table going forward.
So far the AUD/USD hasn’t really responded, but there was not meant to be much (if any) mention of monetary policy today.
That said, the Aussie is starting to look a bit soft on the charts this morning.
Yesterday, I stated that I felt the AUD/USD was ready to break out of this triangle pattern that has been forming. It looks now that we are going to see a downside break.
That puts the 0.6820 and 0.6800 levels clearly in focus going forward today.
There is also the FOMC interest rate decision that we’ll need to look out for which will clearly impact the USD. However, like the RBA, there is no expectation of further cuts going forward. IF anything that should put some upward pressure on the USD and help the AUD/USD fall further.
I’m expecting to see the Aussie continue to fall away and hit the 0.6800 sometime this week.
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