AUD/USD to extend its move downward, next challenge at the 0.7400 level – OCBC

The AUD/USD pair ended the day clear of its key support at 0.7450. Economists at OCBC Bank focus on AUD-downside for now, with the next support zone at 0.7400, but not many strong technical supports after that.

RBA reiterates its dovish tone

“The RBA’s Lowe re-emphasized the importance of getting the unemployment rate to ‘the low 4s’ (compared to 5.1% latest), and that inflation may not return to the 2-3% target until 2024. This essentially reiterated the longer-term dovish guidance at the RBA.” 

“Recent tilt towards risk-off may also see the AUD take over as the main currency to reflect USD-strength.” 

“0.7400 may attract for now.”