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Australian Dollar (AUD) Exchange Rate Forecast – ‘Overvalued’ Aussie fluctuates

stock-marketDuring local trading, the ‘Aussie’ experienced modest volatility as a result of the publication of minutes from the Reserve Bank of Australia’s latest policy meeting.

While the commodity-driven asset plummeted to a five-year low against the New Zealand Dollar it was able to advance on its US and UK counterparts before the end of the Australasian session.

The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6969

The minutes were fairly neutral in tone and highlighted the positive impact interest rate cuts were having on the nation’s economic recovery.

However, the central bank also commented; ‘Given the substantial degree of policy stimulus that had been imparted, it was prudent to hold the cash rate steady while continue to gauge the effects, but not to close off the possibility of reducing it further should that be appropriate. […] There was mounting evidence that monetary policy was supporting activity in interest-sensitive sectors and asset values, and given the lags with which monetary policy operates, the stimulatory effects would likely continue coming through for some time.’

While the central bank also stressed that the Australian Dollar exchange rate continues to be uncomfortably high, yesterday’s announcement of extensive economic reforms in China supported the ‘Aussie’ and limited declines.

Further Australian Dollar gains were enabled as the local conference board leasing index gained 0.3 per cent in September after declining by 0.2 per cent the previous month.

With minutes from the most recent Bank of England policy meeting due out tomorrow, the ‘Aussie’ remained higher against the Pound despite RBA members noting ‘that a lower level of the exchange rate would likely be needed to achieve balanced growth in the economy.’

The Australian Dollar did soften against the Yen before the European session opened as Asian stocks fell for the first time in several days.

As the week progresses, further ‘Aussie’ movement could be inspired by RBA Governor Glenn Steven’s speech and China’s HSBC/Markit Flash Mfg PMI for November.

Current Australian Dollar Exchange (AUD) Rates

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The Australian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9421 >

The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6969 >

The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5854 >

The Australian Dollar/ New Zealand Dollar Exchange Rate is currently in the region of: 1.1297 >

The US Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0627 <

The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4339 <

The Pound Sterling /Australian Dollar Exchange Rate is currently in the region of: 1.7087 <

The New Zealand Dollar/Australian Dollar Exchange Rate is currently in the region of: 0.8858 <

Correct as of 10:40 am GMT