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16 Jul 2013
Flash: RBA continues tone for AUD -BMO
FXstreet.com (London) - Stephen Gallo, European Head of Strategy at BMO suspects the bulk of today’s move in the AUD reflects some combination of stretched downside positioning and no explicit hints in the RBA minutes of an intent to cut rates further, rather than any significant change in tone.
“Importantly, the RBA’s July 2nd statement contained the same usage of the word “appropriate”, with the main difference being that the minutes added the reference to the exchange rate in the same line”. So, he said, whilst it’s very important not to get too worked-up about the minutes today, if the August RBA statement reflects the same tone towards the level of the currency, it’s quite likely that AUD downside will thereafter remain more limited than it did during Q2 until circumstances change.
“Importantly, the RBA’s July 2nd statement contained the same usage of the word “appropriate”, with the main difference being that the minutes added the reference to the exchange rate in the same line”. So, he said, whilst it’s very important not to get too worked-up about the minutes today, if the August RBA statement reflects the same tone towards the level of the currency, it’s quite likely that AUD downside will thereafter remain more limited than it did during Q2 until circumstances change.