Sentiment towards the Aussie dollar should remain bearish amid speculation the RBA may cut the cash rate next week in response to the weak CPI – inflation – update.
The Aussie dollar is trading lower with investors bearish ahead of the Reserve Bank’s rate decision next week.
At 0700 AEST on Friday, the local unit was trading at 76.26 US cents, down from 76.46 cents on Thursday.
Westpac senior market strategist Imre Spiezer said investors bought up Japan’s yen and the New Zealand dollar overnight after their central banks decided to keep their rates on hold.
But he expects the Australian dollar to weaken ahead of the Reserve Bank of Australia’s board meeting and rate decision on Tuesday.
‘Sentiment towards the Aussie dollar should remain bearish amid speculation the RBA may cut the cash rate next week in response to the weak CPI – inflation – update, 76 US cents is vulnerable today,’ he added.
There’s a number of local risk events for the currency on Friday including March domestic private sector credit figures and the producer price index.
There will also be a speech by RBA assistant governor Guy Debelle, who will be the first RBA board member to speak since the shockingly weak inflation figures released on Wednesday.
Overnight the Eurozone’s March quarter gross domestic product and inflation figures are due, as well as US inflation data and China’s purchasing manufacturers index for the same period.
At 7am on Friday, 29 April one Aussie dollar was buying:
76.26 US cents, from 76.46 cents on Thursday*
82.41 Japanese yen, from 82.78 yen
67.15 euro cents, from 67.42 euro cents
109.55 New Zealand cents, from 109.74 NZ cents
52.26 British pence, from 52.56 pence
*Currency closes taken at 1700 AEST previous local session
AAP
