AUD: Australian Dollar relies on rebound

The Australian Dollar rate is traded slightly upward at the Forex currency market today as part of technical rebound after sales of the last three days.

Forex forecast: MACD indicator for the pair AUD/USD has merged with the signal line and is not giving a signal. Stochastic Oscillator goes down the neutral zone, giving a sell signal. 

Forex recommendations: in case of breakdown at the level of 1.0350, the pair will go to 1.0320 and 1.0300.

If downward breakdown does not take place, the pair will consolidate at the current levels. The AUD can reach 1.0410 as part of technical correction.

Statistics released this morning showed that index of business conditions NAB in Australia fell by 3 points in August against the level of -1 point in July. The index declined to the lows since April 2009, indicating slump in the sentiments and prospects. National Australian Bank Ltd, noted commenting this outcome that it reflects increased level of uneasiness and concern that debt crisis will spread further.

As long as external background remains negative, the pair will continue to lose positions.It became known yesterday that trade balance in Australia was at the level of +A$1.83 billion in July against the forecast of +A$1.9 billion, which is slightly better than the data in June, however weaker than predicted. Obviously, external background puts pressure on the economy of the Green Continent.

At the meeting last week, the Reserve Bank of Australia decided to leave the cash rate unchanged at 4.75% per annum, as expected. In the follow-up comments the head of the RBA Glen Stevens noted that “medium term economic prospects look worse that it had been expected a few months earlier. Global financial markets demonstrated severe instability”. The situation with the rate seems logical amid such background. 

“The RBA Committee decided that the most viable option will be to maintain current course of the monetary policy. At the next meeting the RBA will continue to carefully analyze both the prospects for economic growth and inflation in Australia, –said Stevens.The pause in the policy of monetary tightening, maintained by the RBA, has been already going on for 9 months.