AUD/USD moved up to a high of 0.6993 on the decision before falling off
As mentioned in the posts before this, the RBA did not give much away as they made no firm mention on further rate cuts but given their language, they also did not rule out the possibility of that in the coming meetings.
The aussie gained on profit taking as expected but has quickly retraced the earlier advance to be lower on the day again. What gives?
After glancing through the RBA statement, it really didn't offer much of anything new as this could've been fit into the May statement instead. That means that we're one month out and there isn't anything new to digest.
The only thing we can look forward to now is further data, which I expect will reaffirm further calls of more rate cuts down the road. Other than that, watch out for domestic banks' reactions to this. ANZ had just announced an 18 bps cut to its mortgage rate, failing to pass on the full 25 bps rate cut by the RBA. Remember this post?
