The Aussie potrayed substantial negative pressure because of the RBA Governor Lowe’s comments. The RBA Governor Phil Lowe warned of the upward wage pressure if the border remained closed for another one year.
Elsewhere the policymakers further said it would be premature to consider the end of the bond buying program. Which in turn soured the sentiment surrounding the aussie.
The Australia Unemployment Rate had a fall to 5.10% in May from 5.50% in the previous month. Full-Time Employment increased by 97.5K in May. The Labor Force Participation rate had a jump of 66.2% in May from 66% in the previous month. The readings provide some cushion to the lower levels for the aussie.
The rising tensions between Australia and China is another negative factor for Aussie’s performance. In the recent development, the Australian Prime Minister, Scott Morrison while speaking at the Organisation for Economic Cooperation Development (OECD), lashed out at China for undermining the rule of law and threatening free world order.
Australia’s banking watchdog has asked the country’s largest banks to give assurances they are lending responsibly and managing risks in their home loan books amid sky-rocketing house prices and signs of increased risky lending, regulators said Thursday. The Council of Financial Regulators also warned that it was discussing “policy options” that could be used to address risks if growth in household debt substantially outpaced that in income.
On the other hand, The Federal Reserve (Fed) kept monetary policy unchanged on Tuesday, but revisions to the economy and the rate forecast rushed to market bonds and the US dollar. On addition of that, central bank chairman Jerome Powell acknowledged that rising inflation may be more consistent than previously expected and weighed on market sentiment and the previous day’s AUD / USD price.
AUD/USD 4 Hour Chart:
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