RBA October Minutes: Reaction

No surprises from RBA Minutes as market was already expecting a dovish tone leading to the 2nd Oct 2012 cut.

Key takeaways from RBA Minutes:

  • AUD remained historically high
  • Full effect of previous rate cuts still working through the economy
  • Stable inflation expected for next 2 years – gives scope to cut rates further.
  • China’s economy may be “”somewhat weaker” than previously thought

 

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Immediate reaction to the minutes was bearish, with price dropping 20 pips but subsequently rebounded back almost as quickly as it went down. A 2nd attempt was made by the bears to hit 1.0245 support but was also pushed back to pre RBA Minutes levels. 1.0260 was acting as a support/resistance early Asian Session and could similarly be a pivotal point for AUD/USD for the rest of today.

For full RBA Minutes, click here

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