AUDNZD accelerates the downfall to the 1.0770 mark following the RBA decision

AUD/NZD faces some selling pressure and drops to 1.0770 after the Reserve Bank of Australia (RBA) decision.
The RBA decided to keep the interest rate unchanged at 4.10% at its August meeting.
Investors will shift their focus to the New Zealand employment data on Wednesday.

The AUD/NZD cross faces selling pressure and drops to the 1.0770 mark following the Reserve Bank of Australia’s (RBA) interest rate decision. Market players await the New Zealand employment data for fresh impetus. The cross currently trades around 1.0784, down 0.32% for the day.

The Reserve Bank of Australia (RBA) board members decided to maintain the interest rate unchanged at 4.10% at Tuesday’s August monetary policy meeting. RBA Governor Phillip Lowe remarked that the decision to keep rates intact gives the RBA more time to analyze the impact of the interest rate hikes and the economic outlook. However, more monetary policy tightening may be necessary to guarantee that inflation returns to target in a reasonable timeframe, but this will depend on the data and the developing risk assessment.

The economic data released on Monday showed that Australia’s TD Securities Inflation figure dropped to 5.4% YoY from 5.7% in June. Meanwhile, Australia’s Private Sector Credit fell to 0.2% MoM and 5.5% YoY in June, compared to 0.4% and 6.2% prior, respectively. Additionally, Australia’s Retail Sales fell 0.8% MoM, against the expectation of 0.0% and 0.7 prior. The Producer Price Index (PPI) data came in at 3.9% YoY and 0.5% QoQ.

On the Kiwi front, Statistics New Zealand revealed on Tuesday that Building Permits in June were up 3.5% MoM after a 2.23% decline in May. Earlier this week, the National Bank of New Zealand showed that July’s New Zealand ANZ Activity Outlook improved to 0.8%, above the expected 0.9% decline. Meanwhile, ANZ Business Confidence fell from -18 in June to -13.1 in July.

Looking ahead, market participants will digest the interest rate decision and statement. On Wednesday, attention will shift to the New Zealand employment data. Investors will take cues from the data and find trading opportunities for the AUD/NZD pair.