February 5, OctaFX – The Australian dollar rose sharply after a hawkish statement from the central bank, which left interest rates unchanged at 1.50%.
In the statement, governor Philip Lowe said that the country’s economy was doing well with the unemployment rate expected to reduce to below 5%. Inflation rose by 1.8% in 2018 and is expected to pick up. The statement said:
'The low level of interest rates is continuing to support the Australian economy. Further progress in reducing unemployment and having inflation return to target is expected, although this progress is likely to be gradual. Taking account of the available information, the Board judged that holding the stance of monetary policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time."
AUDUSD Technical Analysis
The AUDUSD pair jumped sharply after the RBA’s monetary policy decision. It reached a high of 0.7250, which was the highest level since Friday. This level is between the 61.8% and 100% Fibonacci Retracement levels.
The level is also along the upper line of the Bollinger Band while the RSI too has jumped to almost the 70 level. While the pair could fall slightly, there is a possibility that the price will continue the upward trend.
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