RBA cut rates AUD USD down 160 points

The Royal Bank of Australia (RBA) took a surprise cut to the interest rate last night from 2.5% to 2.25%, causing a sell-off in the AUD/USD down to a 6-year low. Dovish comments followed about the economy opening  possible further cuts in the future, but a key level for the RBA has always been the AUD/USD at 0.75 – it’s now currently trading at 0.76, so its very close to the target they want.

The CHF pairs had more movement as the rumours start to spread of a possible corridor in the EUR/CHF via the SNB. The rumoured figures are 1.05 – 1.10, which put the EUR/CHF firmly above the 1.05 yesterday and has continued to hold.

The euro made gains against the USD yesterday – unlike most others – as the EUR/CHF was bid, helped along with a marginally better manufacturing PMI data. This started the day off pretty flat since last night, with little data out today to change that.

In the UK, the pound struggled yesterday even with slightly stronger than expected manufacturing PMI, with a lot more pressure coming from the EUR/GBP trading pushing it lower. Today is the turn of the construction PMI, which is expected to be weaker than previous at 57.0 from 57.6, meaning we could see more pressure on the pound.

The Kiwi was offered overnight falling nearly as fast as the Aussie, with the unemployment rate expected to drop to 5.3% from 5.4%. It may find some support, but be aware of the RBNZ governor Wheeler speaking after the event, as the markets are paying attention to how the central banks globally are acting.

AUD/USD
Supports  0.7765-0.7730-0.7700    | Resistance 0.7830-0.78600-0.7895

EUR/USD
Supports  1.1300-1.1260-1.1230   | Resistance 1.1370-1.1400-1.1440

GBP/USD
Supports  1.4990-1.4960-1.4910  | Resistance  1.5075-1.5120-1.5160