The AUD languished in Q1 and indifferent price action marked the start of Q2. Economists at Société Générale expect AUD/USD to remain below the 0.70 mark.

RBA kept policy rate on hold

“The RBA kept rates unchanged as expected but wild swings in US bond yields and the mixed start to April for Chinese assets (HSCEI) and industrial metals do not inspire confidence for a sustained return of AUD/USD over 0.70 in the short-term.”

“The next signposts for the AUD besides US bond yields and Chinese data is the Statement on Monetary Policy and updated macro forecasts on 5 May. This follows the next rate meeting on 2 May. In February, the RBA revised up wage growth for this year to 4.2% and core inflation to 4.3%. The growth forecast for this year was revised up to 1.6%.”

“The minutes of the last meeting will be released on 18 April. The level of unanimity or discord around the April pause will give us a better indication of the likelihood that rates have peaked.”