Ella 
AUD/NZD has posted gains for a third consecutive session, trading around 1.0980 during the Asian session on Tuesday. AUD/NZD appreciated after the Reserve Bank of Australia (RBA) made its sixth monetary policy decision to keep the Official Cash Rate (OCR) at 4.35%. Traders are likely to pay close attention to an upcoming speech from Reserve Bank of Australia Governor Michele Bullock, which may shed light on the RBA’s future policy direction.
The Australian dollar (AUD) may be in trouble against other currencies as second-quarter inflation data reduces expectations for another rate hike by the Reserve Bank of Australia. Markets expect the Reserve Bank of Australia to cut interest rates in November, much earlier than previously forecast for April next year.
On the NZD side, expectations of an early interest rate cut from the Reserve Bank of New Zealand (RBNZ) put pressure on NZD/USD and supported AUD/NZD. Previous data showed New Zealand’s annual domestic CPI fell to its lowest level in three years in June. The Bank of New Zealand’s next policy meeting is on August 14, with some markets expecting a rate cut then, and fully expecting a rate cut in October.
Traders are likely to look to China’s July consumer price index (CPI) due on Friday for fresh impetus. CPI is expected to increase by 0.4% annually. Since China is an important trading partner for Australia and New Zealand, a weaker-than-expected reading of China’s economic slowdown could affect both currencies.
