Home Forex News The Australian Dollar is in Rally Mode — More Obstacles also

The Australian Dollar is in Rally Mode — More Obstacles also

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The Australian dollar climbed to a 15-month high against the dollar due to a widening yield differential between Aussie bonds and U.S. Treasuries as the Reserve Bank of Australia dismissed the possibility of negative interest rates, while Governor Philip Lowe said that the currency was broadly in line with economic fundamentals.

However, this pillar of support for the currency may come under threat if inflation data this week prompts the RBA to shift to a dovish stance.

Australia’s second-quarter consumer price inflation data is forecast to have fallen 0.5% year-over-year, well below the central bank’s target range of 2%-3%. New restrictions in Victoria and New South Wales, in response to the surge in coronavirus cases, threatens to further douse inflation, with estimates of a 0.75% reduction in national real GDP growth this quarter.

TREND : WEAK BULLISH

Time                                      :           27/07/2020

Pivot                                      :           0.7123

Technical View                     :             LONG ABOVE 0.7143

Target                                   :            0.7163, 0.7175, 0.7188, 0.7225

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