Investing.com - The Australian dollar is seen trading modestly higher against its U.S. counterpart during Friday’s Asian session after the Reserve Bank of Australia lower its forecasts for Australian GDP and inflation.
In Asian trading Friday, AUD/USD rose 0.09% to 1.0291. The pair was likely to find support at 1.0288, the low of November 16 and resistance at 1.0367, the high of November 18.
Earlier today, RBA pared its 2013 GDP growth outlook to 2.5% from its November forecast of 2.75%. RBA also trimmed its inflation estimate to 3% from 3.25%. The central bank also said the Aussie dollar’s strength impact on inflation may be longer-lasting than expected.
RBA’s moves comes a day after official data showed that the Australian economy added 10,400 jobs in January, beating expectations for a 5,000 increase, following a 3,800 decline the previous month.
Australia's unemployment rate remained unchanged at 5.4% last month, compared to expectations for a rise to 5.5%.
RBA’s latest GDP and inflation assessments are based on AUD/USD trading around 1.03, down from 1.04 in the November forecast. The outlooks also assume the overnight cash rate will remain at 3%, though traders widely expect the central bank to lower interest rates again later this year. Odds are about even RBA will do so at its next meeting in early March.
Assuming RBA lowers rates by 25 basis points to 2.75%, that would give the country record low rates, though even at 2.75%, Australia would have higher interest rates than many developed markets, including the U.S. and Japan.
Interestingly, RBA assumes iron ore prices will not keep residing at their currently robust, something for traders to keep in mind as they await Chinese inflation and trade data due out later today. China is one of Australia’s largest trading partners.
Elsewhere, AUD/JPY fell 0.09% to 96.22 while EUR/AUD rose 0.08% to 1.3040. AUD/NZD dropped 0.15% to 1.2324.
In Asian trading Friday, AUD/USD rose 0.09% to 1.0291. The pair was likely to find support at 1.0288, the low of November 16 and resistance at 1.0367, the high of November 18.
Earlier today, RBA pared its 2013 GDP growth outlook to 2.5% from its November forecast of 2.75%. RBA also trimmed its inflation estimate to 3% from 3.25%. The central bank also said the Aussie dollar’s strength impact on inflation may be longer-lasting than expected.
RBA’s moves comes a day after official data showed that the Australian economy added 10,400 jobs in January, beating expectations for a 5,000 increase, following a 3,800 decline the previous month.
Australia's unemployment rate remained unchanged at 5.4% last month, compared to expectations for a rise to 5.5%.
RBA’s latest GDP and inflation assessments are based on AUD/USD trading around 1.03, down from 1.04 in the November forecast. The outlooks also assume the overnight cash rate will remain at 3%, though traders widely expect the central bank to lower interest rates again later this year. Odds are about even RBA will do so at its next meeting in early March.
Assuming RBA lowers rates by 25 basis points to 2.75%, that would give the country record low rates, though even at 2.75%, Australia would have higher interest rates than many developed markets, including the U.S. and Japan.
Interestingly, RBA assumes iron ore prices will not keep residing at their currently robust, something for traders to keep in mind as they await Chinese inflation and trade data due out later today. China is one of Australia’s largest trading partners.
Elsewhere, AUD/JPY fell 0.09% to 96.22 while EUR/AUD rose 0.08% to 1.3040. AUD/NZD dropped 0.15% to 1.2324.