Australia Dollar bounces on hawkish RBA

from MoneyTrading.com.au

The Australian dollar bounced from lows on Thursday lifted by hawkish remarks from the Reserve Bank of Australia (RBA) that confirmed further rises in domestic interest rates. The Australian dollar tested the support levels at 0.9066 USD before reaching 0.9121 after RBA Assistant Governor Philip Lowe said rates here should continue to rise toward more normal levels.

So upbeat was Lowe on Australia's economy that he said the Australian dollar is expected to be higher than the average of the past decade. Implied rates show investors are priced for a 55 percent chance of rates rising to 4.25 percent in April, from 4.0 percent now. Over the next 12 months, another 124 basis points of rate rises are seen.

Australia Dollar lower following weaker motor vehicle sales in February

from MoneyTrading.com.au

The number of new motor vehicle sales in Australia slipped a seasonally adjusted 1.9% in February compared with the previous month, official data showed on Monday.

The Australian Bureau of Statistics said in a report that there were 85,035 such sales during the month. Sales fell 3.5% in January.

According to the Sydney Morning Herald, economists say an 8.6% drop in sales of new commercial vehicles – which were included in the category of "other vehicles" – was the result of the Australian government's removal of a tax break for business investment.

In the wake of the report, the Australian dollar slid against its U.S. counterpart, with AUD/USD falling 0.33% to hit 0.9124.