HomeLive CommentsAussie jumps after strong building permits and receding RBA cut bets

Aussie jumps after strong building permits and receding RBA cut bets

Australian Dollar surges broadly today firstly with the help from post FOMC selloff in Dollar. In the background, Aussie has been riding on optimism towards US-China trade negotiations recently. The strong housing data today also eased concerns of a renewed downturn in the housing markets. Building permits rose 7.6% mom in September, way above expectations of 0.1% mom. Other data, while missed, were not disastrous. Private sector credit rose 0.2% mom in September versus expectation of 0.3% mom. Import price index rose 0.4% qoq in Q3 versus expectation of 0.5% qoq.

As Westpac noted in a report today, RBA should stand pat at its next meeting on November 5. Market pricing of a December cut also dropped from 80% back on October 4 to 25%. But most notably, market pricing of a February cut halved from 100% on October 4 to 50% today. While the pricing of February cut was not Westpac concurs with, that’s a factor in driving the Aussie higher today.

AUD/JPY’s rebound from 69.95 extends higher today and for now, near term outlook stays bullish as long as 73.93 support holds. Next target is 76.16 cluster resistance, which is close to 100% projection of 69.96 to 74.49 from 71.73 at 76.27. Reaction to this level will decide whether AUD/JPY has reversed the larger down trend, or it’s just in corrective rise.

Featured Analysis

Learn Forex Trading