Australian Dollar Trends: RBA Decision and China Policy Impact on AUD/USD

RBA Interest Rate Decision: Hawkish or Dovish?

The RBA interest rate decision, Rate Statement, and press conference will impact the AUD/USD pair on Tuesday, September 24. Economists expect the RBA to hold the cash rate steady at 4.35%. Recent flash PMI numbers for September likely reduced expectations of a Q4 2024 RBA rate hike.

Nevertheless, inflation remains above the RBA's target range of 2-3%. Elevated inflation may expose the AUD/USD to a potentially hawkish RBA.

RBA Governor Michele Bullock's Stance on Monetary Policy

In early September, Governor Bullock said that interest rate cuts were unlikely in 2024, citing elevated housing costs and market services inflation. The message was less hawkish than an August warning about raising rates to address high inflation.

Australian Inflation Trends and Forecasts

Inflation has softened, with the Monthly CPI Indicator falling from 3.8% in June to 3.5% in July. Notably, the August Monthly CPI Indicator is due on Wednesday, with economists expecting inflation to fall to 3.1%.

China's Top Financial Regulators to Attend a Pre-Market Press Conference

Meanwhile, China’s top financial regulators will attend a pre-market press conference on Tuesday. News of the press conference fueled speculation about policy measures to boost the Chinese economy. These measures could positively impact the Aussie economy and dollar due to China accounting for one-third of Aussie exports.

US Economic Calendar: Consumer Confidence in Focus

Later in the session on Tuesday, economists expect the CB Consumer Confidence Index to fall from 103.3 in August to 102.9 in September. A modest decline could support expectations of a soft US landing. Weaker-than-expected numbers could push the AUD/USD toward $0.69.

Short-Term Forecast for AUD/USD

Near-term AUD/USD trends will hinge on policy news from China and the RBA press conference. Investors should closely monitor central bank signals and economic indicators, which will likely influence AUD/USD trends.

AUD/USD Technical Analysis

The AUD/USD hovers comfortably above the 50-day and 200-day EMAs, affirming bullish price signals. A return to the September 23 high of $0.68536 could support a move toward $0.69. Conversely, a drop below the $0.68006 support level could signal a fall toward $0.67500.