FX News – November 19: Aussie Weakens After Release of RBA Minutes

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The Reserve Bank of Australia (RBA) earlier released the minutes of its monetary policy meeting for November. As expected, it kept the same neutral tone it had in its past statements. Also, the RBA continues to think that the aussie is overvalued.

In the minutes, it was reported that: "the Australian dollar, while below its level earlier in the year, remained uncomfortably high. Members noted that a lower level of the exchange rate would likely be needed to achieve balanced growth in the economy."

In addition, the board said that it is still open to the possibility of reducing rates further if needed.

Traders' initial reaction to the RBA minutes led to the AUD/USD pair to drop below the 0.9400 level once again, going to a low around the 0.9365 area. It has somewhat recovered though, and is currently trading at 0.9375.

Initial resistance for the AUD/USD pair is at 0.9398, followed by 0.9421. Meanwhile, initial support is at 0.9335, followed by 0.9312.

As for the USD/JPY, the pair dropped just after yesterday's US session after Wall Street lost 0.24%. This led the pair to slide from the 100.00 area to around 99.55. It has continued to struggle in today's session, as traders await Japan's Leading Economic Index and Coincident Index for September (5:00 AM, GMT), and a number of speeches from the US Fed later today. The pair is currently trading at 99.74, with initial resistance seen at 100.17, followed by 100.42. Meanwhile, initial support is at 99.54, followed by 99.29.

In Europe, traders wait for economic sentiment data, and a number of other reports, which could help dictate the tone of the EUR/USD pair in today's trading. The pair is currently trading at 1.3513, with initial resistance seen at 1.3557, followed by 1.3591. Meanwhile, initial support is at 1.3490, followed by 1.3456.

By FX Strategy Team, Published on 19th of November 2013
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