On Tuesday the Governing Board of Directors of the Reserve Bank of Australia released its detailed Minutes report from the bank’s last Monetary Policy Meeting, which took place on the 5th of November.
The report provides a comprehensive outlook on the Board’s extensive economic and financial projections for mid-term development of the Australian economy.
As regards the Board’s outlook on the most recent international developments, the expressed tone of the Board is noticeably sceptical with only a marginal room for optimism:
“The risks to the global growth forecasts were still tilted to the downside. Although the prospects for a partial trade agreement between the United States and China had improved since the previous meeting, the likelihood of a more comprehensive agreement remained uncertain. The outlook for global growth was being supported by accommodative financial conditions.”
Nevertheless, the Board’s commentary on the internal developments in Australia over the previous quarter sounded much more upbeat and optimistic:
“Members noted that housing market conditions had continued to strengthen in Sydney and Melbourne, and conditions appeared to have firmed in other cities, including Brisbane. […] Employment had continued to grow strongly, at 2.5 per cent in year-ended terms. The unemployment rate had been 5.2 per cent in September, which was little changed since April. The employment-to-population ratio had continued to rise and was at its highest level since 2008. […] Inflation in the September quarter had been in line with forecasts presented in August and confirmed that inflationary pressures remained subdued.”
Overall, the release of the Monetary Policy Minutes had a positive effect on the Australian dollar, as the major bearish downswing from last week is now at least temporarily stopped.
The corrective downturn of the AUDUSD was curbed, as the price was held back at the major support level of 0.68000
The pair appears to be consolidating above that level with the potential of subsequently bouncing off from it in a renewed bullish upswing.
AUDUSD 1D Price Chart. Image source: Trendsharks ©, created with TradingView.com
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