AUD/NZD, AUD/USD analysis ahead of May RBA decision

May 01, 2023 08:29 PM AEST | By Invezz

AUD/NZD, AUD/USD analysis ahead of May RBA decision — Image source: Invezz

RBA interest rate decision

One of the biggest forex news this week will be the upcoming interest rate decision by the Reserve Bank of Australia scheduled for Tuesday this week. This will be an important decision since it comes on the same week that the government will unveil its budget.

Economists expect the RBA to leave interest rates unchanged at 3.60% as it continues to observe the state of the economy after the recent rate hikes. The decision will come after data showed that the country’s inflation is easing. According to the Australian Bureau of Statistics showed that inflation dropped from 6.8% to 6.3%. Core inflation also continued falling. In a note, an analyst at ANZ said:

“Australia’s trimmed mean inflation came in lower than expected at 6.6 per cent year-on-year. This supports our view that the RBA will maintain the cash rate at 3.60 per cent at its May meeting.”

The RBA decision will come a day ahead of the Federal Reserve delivers its interest rate decision. As I wrote in this article, analysts expect that the bank will hike interest rates by 0.25% in this meeting. It will also point to a pause in the coming months.

AUD/NZD technical analysis

The 4H chart shows that the AUD/NZD exchange rate has drifted upwards in the past few days. It has moved from a low of 1.0682 to a high of 1.0750.

The pair has moved to the major S&R pivot point of the Murrey Math Lines. It has moved below the 50-period moving average while the Relative Strength Index (RSI) is approaching the neutral point at 50. Therefore, there is a likelihood that the AUD to NZD pair will continue rising as buyers target the key resistance at 1.080, the highest point in March and early April.

AUD/USD technical analysis

The 4H chart shows that the AUD/USD price has drifted upwards in the past few days. It has moved from a low of 0.6576 to a high of 0.6650. The pair has also jumped above the key resistance level at 0.6618, the lowest point on April 10. It has moved below the 50-period moving average. Therefore, the pair will likely continue falling as sellers target the key support at 0.6570.

AUD/USD chart by TradingView

The post AUD/NZD, AUD/USD analysis ahead of May RBA decision appeared first on Invezz.

Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (Kalkine Media, we or us), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.