Forex - AUD/USD higher following RBA comments

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Investing.com - The Australian dollar advanced against its U.S. rival during Tuesday's session, buoyed by comments from a central banker there that the Aussie would need to climb further before intervention becomes necessary.


In Asian Tuesday, AUD/USD rose 0.22% to 1.0280. The pair was likely to find support at 1.0238, the low of February 20 and resistance at 1.0320, the high of February 18. Earlier in the session, AUD/USD traded as higher as 1.0292.

The pair tumbled 0.35% during Monday's U.S. session due to some discouraging Chinese economic news. Data showed that China's HSBC Flash Purchasing Managers Index, the earliest indicator of the country's industrial activity, fell to a four-month low of 50.4 in January from a final reading of 52.3 in December. China is Australia's biggest export partner.

The Aussie got a lift today after Reserve Bank of Australia Assistant Governor Guy Debelle said the currency would have to rise from current levels before the central bank could consider intervention.

Following a speech at University of Adelaide Business School, Debelle told the media that if intervention is needed, there is no limit to RBA's scope in terms of selling its local dollar.

Still, the comments are a departure from what was heard out of New Zealand last week. Also grappling with a strong dollar, Reserve Bank of New Zealand Governor Graeme Wheeler said RBNZ stands ready to intervene in the currency markets to help cool the Kiwi.

Neither Australia nor New Zealand have engaged in Federal Reserve-style quantitative easing, a fact that in large part explains the strength of the Aussie and the Kiwi.

Elsewhere, AUD/JPY added 0.55% to 94.69 while EUR/AUD fell 0.13% to 1.2718. AUD/NZD inched lower by 0.03% to 1.2319.


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This article appears in: Investing , Forex and Currencies

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