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At the Forex currency market the Australian Dollar rate continues to remain under selling pressure on Wednesday because interest in risk is minimal in the market at the moment.

Forex forecast: MACD indicator is in the positive area for the pair AUD/USD and is moving along the signal line, although trading volumes remain high. Stochastic Oscillator has come out of the overbought zone and goes down in the neutral zone, giving a pair sell signal.

Forex recommendations: in case of breakdown at the level of 1.0810 the levels of 1.0800 ? 1.0770 will become targets for decline.

The data released today showed that sale of new houses in Australia increased by 4.3% m/m in April, as per HIA estimates versus preliminary expectations of growth by 0.6% m/m. In addition, index of business activity in the service sector of Australia rose to 51.5 points in April, as per estimates of AIG/Commonwealth Bank, against the previous level of 46.5 points. However,  the AUD disregarded  this statistics.

The Reserve Bank of Australia decided to leave interest rate at the previous level of 4.75% per annum. At the same time the RBA was not eloquent in the follow up comments – and this was the indication for investors to start sales.

It became known on Wednesday that CPI in Australia increased by 1.6% on quarterly basis (+3.3% y/y) in QI. Therefore, inflation in the Green Continent has reached five-year highs; natural disasters have triggered the rise in costs for food and other consumption goods for people. In addition, commodity prices at the global markets remain high, because tension in the Middle East does not abate.

Kevin Rood, Minister of Foreign Affairs in Australia said earlier that RBA has no plans to carry out currency intervention, although national currency is considerably overvalued. 

As it was made public earlier, index of import prices increased by 0.9% on quarterly basis in QI. Index of leading indicators rose by 4.7% y/y in March against the rise by 4.8% in February. It is a good result taking into account that the Reserve Bank of Australia keeps interest rate unchanged for a long time. Leading indicators index demonstrates good growth in the Australian economy: indicators show that growth is unlikely to be too high next year; however there will be some growth. 

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