For the 24 hours to 23:00 GMT, the AUD declined 3.04% against the USD and closed at 0.6732, following disappointing trade and retail sales data from Australia.
LME Copper prices rose 0.2% or $12.0/MT to $5,726.0/MT. Aluminium prices climbed 0.6% or $10.0/MT to $1,698.0/MT.
In the Asian session, at GMT0400, the pair is trading at 0.6721, with the AUD trading 0.16% lower against the USD from yesterday’s close, after the Reserve Bank of Australia (RBA) cut its growth forecast for 2020.
The RBA, in its monetary policy statement, lowered its 2020 growth forecasts, citing the impact of the recent drought, bushfires and outbreak of the coronavirus. The central bank now expects growth to reach 1.9% in the year to June 2020 compared to the previous forecast of 2.6%. However, it expects growth to accelerate to 2.7% by the end of 2020 and to 3.0% by the close of 2021.
Overnight data showed that Australia’s AiG performance of services index dropped to 47.4 in January, compared to a reading of 48.7 in the previous month.
Separately, the RBA Governor, Philip Lowe, stated that additional cuts to an already record-low interest rate risked doing more damage to the economy. Further, he warned that rising risks due to the outbreak of coronavirus in China, Australia’s largest trading partner, as well as signs of weaker hiring and inflation could result in further rate cuts.
The pair is expected to find support at 0.67, and a fall through could take it to the next support level of 0.668. The pair is expected to find its first resistance at 0.6753, and a rise through could take it to the next resistance level of 0.6786.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
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