Investing.com - The Australian dollar traded higher against its U.S. rival during Wednesday’s Asian session after earlier trading lower against the greenback.
In Asian trading Wednesday, AUD/USD rose 0.23% to 0.9171 after earlier trading as low as 0.9136. The pair was likely to test support at 0.9114, Friday's low, and resistance at 0.9254, Monday's high.
Traders sent the Aussie tumbling Tuesday after the Reserve Bank of Australia left interest rates unchanged at a record low of 2.75% while leaving the door open for future rate reductions.
"The Australian dollar has depreciated by around 10% since early April, although it remains at a high level. It is possible that the exchange rate will depreciate further over time, which would help to foster a rebalancing of growth in the economy," Reserve Bank of Australia Governor Glenn Stevens said in a statement.
Stevens was quick to note that the Aussie’s recent spate of weakness has been helpful for the world’s 12th-largest economy. Stevens is scheduled to speak later today in Brisbane, his first speech since April.
With RBA scheduled to meet again on August 6, some traders are pointing to Australian inflation data due out later this month as perhaps the next impetus for the central bank to lower rates. As it is, the Aussie is the second-worst performing developed market currency in the world this year behind only the yen.
Even at 2.75%, Australia has one of the highest interest rates in the developed world, but the slumping currency could be a sign that mining companies, a pivotal part of the economy there, are expecting lower commodities prices to continue.
Meanwhile, the Australian Bureau of Statistics said that Australian retail sales rose 0.1% last month after falling 0.1% in May. Analysts expected a June increase of 0.3%.
Elsewhere, AUD/JPY rose 0.26% to 92.34 while AUD/NZD inched up 0.08% to 1.1813.
In Asian trading Wednesday, AUD/USD rose 0.23% to 0.9171 after earlier trading as low as 0.9136. The pair was likely to test support at 0.9114, Friday's low, and resistance at 0.9254, Monday's high.
Traders sent the Aussie tumbling Tuesday after the Reserve Bank of Australia left interest rates unchanged at a record low of 2.75% while leaving the door open for future rate reductions.
"The Australian dollar has depreciated by around 10% since early April, although it remains at a high level. It is possible that the exchange rate will depreciate further over time, which would help to foster a rebalancing of growth in the economy," Reserve Bank of Australia Governor Glenn Stevens said in a statement.
Stevens was quick to note that the Aussie’s recent spate of weakness has been helpful for the world’s 12th-largest economy. Stevens is scheduled to speak later today in Brisbane, his first speech since April.
With RBA scheduled to meet again on August 6, some traders are pointing to Australian inflation data due out later this month as perhaps the next impetus for the central bank to lower rates. As it is, the Aussie is the second-worst performing developed market currency in the world this year behind only the yen.
Even at 2.75%, Australia has one of the highest interest rates in the developed world, but the slumping currency could be a sign that mining companies, a pivotal part of the economy there, are expecting lower commodities prices to continue.
Meanwhile, the Australian Bureau of Statistics said that Australian retail sales rose 0.1% last month after falling 0.1% in May. Analysts expected a June increase of 0.3%.
Elsewhere, AUD/JPY rose 0.26% to 92.34 while AUD/NZD inched up 0.08% to 1.1813.