The Australian dollar remained close to yesterday’s highs after the RBA left interest rates unchanged for the 28th consecutive month. The bank said that the current expansionary policy was helping the country improve its economic situation stating how the unemployment rate was at 5.0%, which was the lowest level it has been in six years, while inflation has remained low and stable. Inflation is expected to pick up over the next couple of years reaching 2¼ in 2019, up from the current 1.9%. During the past two months, the Aussie has gained by more than 5% making it one of the best-performing currencies. Tomorrow, traders will receive the final reading of the Q3 GDP growth.
The price of crude oil continued the rally started yesterday in overnight trading. The price of Brent rose to a high of $62.3 while that of West Texas Intermediate (WTI) rose to $53.9. The rally comes after Saudi and Russia agreed to halt production ahead of the OPEC meeting on Thursday. It also rose mostly because of optimism that global growth will pick up in 2019 after the trade truce between US and China. Later today, the American Petroleum Institute (API) will release inventory numbers for the past week.
The Canadian dollar halted the sharp gain started on Friday evening. This is as traders wait for the important labor productivity data for the third quarter. Traders expect the number to show that productivity increased by 0.4%. This will be lower than the previously-released gain of 0.7%. Tomorrow, the Bank of Canada will release its interest rates decision. Traders expect that the bank will leave rates unchanged during this meeting.
EUR/USD
The euro rose sharply against the USD in overnight trading. This happened despite ISM manufacturing PMI data showing a rise in PMI to 59.3, which was higher than the consensus estimate of 57.6. The pair reached an intraday high of 1.1375. The pair’s price is above the 25-day and 50-day EMA and is closer to the high of 1.1400. With no major economic data expected today, the pair could continue moving up to the resistance level of 1.1400.
USD/CAD
The USD/CAD pair eased the decline started on Friday as traders wait for the labor productivity data from Canada and the decision of the BOC tomorrow. The current price of 1.3180 is below the important 50-day and 25-day EMA. It is also along an important support on the four-hour chart below. The pair will likely continue the downward movement ahead of the BOC decision. If it does, traders should watch out for the important support level of 1.3050.
XBR/USD
The price of Brent crude continued rising overnight as sentiment rose. The XBR/USD pair reached a high of 62.65, which is the highest level since November 23. The RSI has moved up from 21 to the current 58. Since markets move by sentiment and the fear of missing out, there is a likelihood that the price of Brent will continue moving up. If it does, it will likely test the important resistance level of 65 in the short term.
