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Forex - AUD/USD declines after RBA minutes disappoint

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Forexpros - The Australian dollar was down against its U.S. counterpart on Tuesday, surrendering some of the previous day's gains after the minutes of the Reserve Bank of Australia's August 2 meeting showed that policy makers extended a pause on interest rates due to global growth concerns.

AUD/USD hit 1.0410 during late Asian trade, a daily low; the pair subsequently consolidated at 1.0424, shedding 0.78%.

The pair was likely to find support at 1.0244, the low of August 12 and resistance at 1.0526, the high of August 5.

In minutes of its August 2 policy-setting meeting published earlier in the day, the RBA said, "The case against tightening at this meeting was that the downside risks to demand had probably increased, as a result of the acute uncertainty in global financial markets."

"Significantly, the downside risks had become more pronounced recently," policy makers said.

The minutes added that the turmoil in financial markets could slow global economic growth, in turn dampening the inflation outlook and easing pressure on the central bank to raise rates.

The RBA left its benchmark interest rate on hold at 4.75% for the eighth straight meeting in August.

Meanwhile, markets were awaiting a meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy in Paris later in the day, as the two leaders attempt to ease fears over the euro zone's ongoing debt crisis.

Elsewhere, the Aussie was also down against its New Zealand cousin, with AUD/NZD slumping 0.42% to hit 1.2561.

Later in the day, the U.S. was to produce official data on building permits and housing starts, as well as reports on import prices, the capacity utilization rate and industrial production.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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