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The RBA is up this week!

What do central bank members have to say? More importantly, how will the market react?

I’ve got the deets on the points you need to watch if you’re trading the Aussie!

RBA’s policy decision (Oct 6, 3:30 am GMT)

  • Last month the Reserve Bank of Australia (RBA) kept its interest rates steady but expanded the size and term of its funding for lenders program
  • RBA isn’t expected to make monetary policy changes ahead of the Treasury’s budget announcement where additional fiscal stimulus is expected
  • Some analysts are still betting on a rate cut, so RBA’s decision could still see volatility during the release
  • Others also speculate that a no-rate cut decision this week would mean a November rate cut

Market risk appetite

  • China’s markets will be out for most of the week
  • The U.S. Presidential elections and Brexit negotiations can also grab headlines and influence high-yielding currencies like the Aussie
  • COVID-19 headlines (vaccine, stimulus, lockdown, economic recovery) from around the world will continue to influence risk-taking in the markets
  • FOMC’s meeting minutes and speeches from the Fed, ECB, BOE, and BOC Presidents can cause intraday swings for major Aussie pairs

Technical snapshot

  • Stochastic places the Aussie in neutral zone against JPY, USD, CAD, and EUR on the daily time frame
  • AUD is leaning towards being “oversold” against GBP
AUD Forex Pairs Stochastic from MarketMilk
AUD Forex Pairs Stochastic from MarketMilk
  • EMAs show the Aussie’s short and long-term bullish trends against most of its major counterparts
AUD Forex Pairs EMAs from MarketMilk
AUD Forex Pairs EMAs from MarketMilk
  • Like the Kiwi, the Aussie was most volatile against the safe havens and the pound in the last seven days
AUD Forex Pairs Volatility from MarketMilk
AUD Forex Pairs Volatility from MarketMilk

Missed last week’s price action? Read AUD’s price recap for Sept 28 – Oct 2!