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At the Forex currency market the Australian Dollar rate has reached highs once again on Wednesday, exceeding the level of 1.0704. It is a good result for the commodity currency

Forex forecast: MACD indicator is in the positive area for the pair AUD/USD and is going up, giving a pair buy signal. Stochastic Oscillator remains in the overbought zone, giving a similar signal.

Forex recommendations: in case of breakdown at the level of 1.0700 the pair can go to 1.0730. It is worth noting that probability of technical pullback is high at the moment.

Unemployment rate reduced to 4.9% in March versus the preliminary level of 5.0% and employment rate rose by 37.8 thousand last month against the forecast of increase by 24 thousand. Therefore, strong performance in the employment sector pushed the AUD to go upward, instilling investors with the idea that the RBA can resume monetary tightening policy earlier. On the other hand deficit of trade balance was recorded in the country for the first time since spring 2010 (February -?$205 billion against +A$1.4 billion in January). In addition activity index in the service sector reduced to 46.5 points in March against the value of 48.7 points in February.

It became known in the middle of the week that index of prices for import increased by 0.9% on quarterly basis in QI. Leading indicators index 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: figures show that growth is unlikely to be too high next year; however there will be some growth.

As noted in the minutes of the meeting of 5 April, released by the Reserve Bank of Australia, current monetary politics is quite acceptable, however, at the same time the regulator expects growth of inflation rate. GDP is expected to be strong in QI. The document clarifies that “main index of CPI can demonstrate growth in March, while GDP will decline more significantly in QI than previously expected. The Committee will carefully consider all these factors”.  

Following the meeting of the Reserve Bank of Australia in April the decision was made to keep current level of the interest rate unchanged at the level of 4.75% per annum – it has been for the fourth time already that the RBA does not dare to continue monetary policy tightening. Judging by recent comments, we should not expect the rise in the interest rate at the next meeting either.

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