Higher interest rates have had a positive impact on multiple economic sectors of the Australian economy, the latest RBA meeting minutes say.
The central bank assumes that the Australian Dollar is still overvalued, which causes some problems. Therefore, the RBA may well cut interest rates in the near future, especially if to take into account the current rate of inflation along with moderate inflation expectations.
As of today, the RBA’s key interest rate is 3%. Since late 2011, the RBA has already cut the rate by 175 percent points. However, the central bank hasn’t still made any monetary changes this year.
Still, investors assume that the probability of the RBA cutting the key interest rate in May is around 27%. At the same time, they say the probability of interest rate cuts in 2013 is 40%.
Forex.
The chart below, courtesy of , reflects the current state of affairs in the market of AUDUSD. The currency pair is going down in the form of wave A/B of level Weekly.
The closest levels of support are 1.0254, 1.0224/20 and 1.0202. The current bearish move will be completed as soon as the price overcomes the top of the MF sloping channel and consolidates above 1.0395 (as shown below).
