Australian Dollar Rallies After RBA Minutes

The Australian dollar rallied following the release of the October policy meeting held by the Reserve Bank of Australia. The currency also got support from rallying Asian equities and rising crude oil prices.

Unlike the previous RBA Governor, Philip Lowe did not complain about the exchange rate, saying that “the lower exchange rate since 2013 had been helping the traded sector,” though he also mentioned that “an appreciating exchange rate could complicate this.” The minutes said in the conclusion:

Members noted that data on CPI inflation for the September quarter and an update of the forecasts would be available at the next meeting. This would provide an opportunity to consider the economic outlook, assess the effects of previous reductions in the cash rate and review conditions in the labour and housing markets.

This means that the next week’s inflation data can have a tremendous impact on the Aussie.

AUD/USD rallied from 0.7627 to 0.7672 as of 12:20 GMT today, touching the high of 0.7689 intraday. EUR/AUD dropped from 1.4415 to 1.4327, trading near the lowest level since June 2015.

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