Investing.com - The Australian dollar traded lower against its U.S. counterpart during Tuesday’s Asian session following the release of minutes from the most recent monetary policy meeting of the Reserve Bank of Australia.
In Asian trading Tuesday, AUD/USD dropped 0.38% to 0.9080. The pair was likely to find support at 0.9058, the low of August 15 and resistance at 0.9318, the high of July 24.
Earlier this month, RBA lowered its benchmark borrowing rate by 25 basis points to a record low of 2.5%, although the minutes released earlier Tuesday provided little in the way of clues regarding future rate cuts.
"The Bank should neither close off the possibility of reducing rates further, nor signal an imminent intention to reduce rates further," said RBA in the minutes.
RBA added: "Inflation remained low and, allowing for the effects of the introduction of the carbon price, was around the bottom of the target range. Wages growth was slowing. ... inflation would be pushed up for a period by the lower exchange rate, but even so was forecast to be around the middle of the target range."
The inflation commentary could prove important because it is Australia’s benign inflation outlook that has previously given RBA room to lower rates.
"The course of the exchange rate would be important. It had declined since the previous meeting, though remained high by historical standards. It was possible the exchange rate would decline further over time, which would assist in rebalancing growth in the economy," the bank said regarding its desires to see the Aussie fall further.
Elsewhere, AUD/JPY fell 0.17% to 88.79 while AUD/NZD jumped 0.76% to 1.1380.
In Asian trading Tuesday, AUD/USD dropped 0.38% to 0.9080. The pair was likely to find support at 0.9058, the low of August 15 and resistance at 0.9318, the high of July 24.
Earlier this month, RBA lowered its benchmark borrowing rate by 25 basis points to a record low of 2.5%, although the minutes released earlier Tuesday provided little in the way of clues regarding future rate cuts.
"The Bank should neither close off the possibility of reducing rates further, nor signal an imminent intention to reduce rates further," said RBA in the minutes.
RBA added: "Inflation remained low and, allowing for the effects of the introduction of the carbon price, was around the bottom of the target range. Wages growth was slowing. ... inflation would be pushed up for a period by the lower exchange rate, but even so was forecast to be around the middle of the target range."
The inflation commentary could prove important because it is Australia’s benign inflation outlook that has previously given RBA room to lower rates.
"The course of the exchange rate would be important. It had declined since the previous meeting, though remained high by historical standards. It was possible the exchange rate would decline further over time, which would assist in rebalancing growth in the economy," the bank said regarding its desires to see the Aussie fall further.
Elsewhere, AUD/JPY fell 0.17% to 88.79 while AUD/NZD jumped 0.76% to 1.1380.