- RBA expected to cut rate in November
- Australia’s net debt will increase
- Trading AUD/JPY (H4) in the range
The Reserve Bank of Australia held its cash rate unchanged at 0.25% during their monetary policy meeting on Tuesday. However, it is expected that the central bank will carry out a rate cut during the November’s meeting. This is hinted at in the rate statement released on Tuesday, stating that the central bank “continues to consider how additional monetary easing could support jobs as the economy opens up further.” Also, the Treasurer of Australia Josh Frydenberg highlighted that the country’s net debt will increase to $703 billion, equivalent to 36% of GDP this year, which contributed to the weakening of AUD/JPY on Tuesday.
AUD/JPY (H4) has been ranging within the key levels of 75 and 76 since last Wednesday. At the moment, AUD/JPY is testing to break above the key level of 76 for the third time recently. If AUD/JPY bounces down from the key level of 76, we may be looking at a potential selldown to the key level of 75 once our technical indicators indicate a downward momentum.
Potential Price Movers
08 Oct at 0830 (SGT): Reserve Bank of Australia will be releasing their Financial Stability Review.
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