AUD suffering against greenback as weak data is digested
- FX Market
- 8 months ago
The AUD/USD price looks to take a hit as weak economic growth data from Australia makes the reduction of interest rates a close reality.
GDP expanded in the fourth quarter of last year by just 0.2% quarter-on-quarter, below both the predicted 0.5% and the third quarter’s 0.3%, while on a year-on-year basis it rose by 2.3%, far below the forecasted figure of 2.6% and the prior 2.7%.
The data released earlier today, suggest that the Reserve Bank of Australia could be too optimistic in its forecast of 3.0% economic growth this year and that interest rates may need to be cut in coming months to stimulate activity, perhaps by October, even though the RBA is reluctant to do so.
That prospect has extended the decline in the AUDUSD price, which has been falling for more than a week.
Source: Smart Trend Team