Australian dollar declines after RBA interest rate decision
The Japanese yen declined against the US dollar even after relatively strong economic data. According to the country's statistics bureau, the unemployment rate remained unchanged at 2.9% in January. This was better than the median estimate of an increase to 3.0%. The jobs to applications ratio increased from 1.06 to 1.10. Meanwhile, capital expenditure declined by 4.8%, an improvement from the previous decrease of 10.6%. These numbers came a day after Markit said that the manufacturing PMI increased from 49.8 in January to 51.4 in February.
The Australian dollar declined slightly after the RBA interest rate decision. The bank left interest rates unchanged at 0.10% and pledged to continue supporting the economy. It also left its quantitative easing and yield curve control policies intact. This decision came a day after it doubled its bond purchases from A$2 billion to A$4 billion. Earlier on, data showed that the country’s building approvals declined by 19.4% in January while private house approvals declined by 12.2%.
The economic calendar will be relatively eventful today. In the United Kingdom, Nationwide will publish the latest house price index (HPI). Economists expect the data to show that the index increased by 5.6% in February. In the Eurozone, Eurostat will publish the preliminary consumer price index (CPI). In Germany, the statistics agency will deliver the latest employment numbers. In Canada, the statistics agency will publish the latest GDP data. In addition, traders will watch out the performance of the US yields and cryptocurrencies.
The EUR/USD pair declined to an intraday low of 1.2033, which was the lowest level since February 17. On the four-hour chart, the 25-day and 15-day exponential moving averages have made a bearish crossover. The Relative Strength Index (RSI) and MACD have also continued to drop. Therefore, further drops will be validated if the price moves below the important support at 1.2020.
The XBR/USD price dropped sharply in the overnight session as traders waited for the upcoming OPEC+ meeting. The pair reached a low of 62.35, which is substantially below the year-to-date high of 66.73. The price has also moved below the upper side of the ascending channel. It has also moved below the 15-period and 25-period exponential moving averages (EMA) while the Relative Strength Index (RSI) has been falling. Therefore, the path of the least resistance is lower.
The AUD/USD price dropped slightly to an intraday low of 0.7755. On the four-hour chart, the pair has formed a bearish consolidation pattern. It is also a few pips above the important support at 0.7688. The pair is also below the short and medium-term moving averages. Therefore it may resume the downward trend in the near term.