Aussie Surges Following GDP Beat
The Australian dollar spiked to almost $0.9300 on news that economy expanded by 1.1% in Q1 rather than the 0.9 % the consensus expected. It is the fastest pace in two years. This comes on the heels of the Reserve Bank of Australia leaving rates unchanged, and striking a neutral tone post their monetary policy decision on Tuesday. Tomorrow’s ECB interest rate decision along with the US payroll report on Friday will go a long way in determining the direction of the exchange rate.
Australia GDP rose 1.1% in Q1 quarter over quarter, beating expectations after a 0.8% gain in Q4. Final consumption expenditure increased by 0.5% quarter over quarter after the 0.7% expansion in Q4. Exports rose 4.8% in Q1 after a 1.1% Q4 rise. Net exports added 1.4% to GDP while final consumption expenditure added 0.3% to GDP. Inventories were a slight drag, subtracting 0.6% from GDP.
The Australian currency performed well in the wake of the GDP against both the greenback and the yen. The AUDJPY is poised to test trend line resistance near 96.00. Support on the currency pair is seen near the 10-day moving average at 94.50.
Momentum on the AUDJPY currency pair is positive as the MACD (moving average convergence divergence) index generated a buy signal. This occurs as the spread (the 12-day moving average minus the 26-day moving average) crosses above the 9-day moving average of the spread. The MACD index moved from negative territory to positive territory confirming the buy signal.
Additionally, the RSI (relative strength index) which is a momentum oscillator that measures overbought and oversold levels, moved higher with price action, which reflects accelerating positive momentum. The RSI is currently printing near 56, which is in the middle of the neutral range.
Sorry. No data so far.