When are the RBA minutes and how might they affect AUD/USD?

Early Tuesday morning, at 01:30 GMT, the Reserve Bank of Australia (RBA) will release minutes of the latest monetary policy meeting held during the early-August.

The RBA’s August month monetary policy meeting matched wide market forecasts of no rate cut and an intact bond-buying program. However, the coronavirus (COVID-19) second wave and related economic pessimism gained more attention during the quarterly Statement of Monetary Policy (SOMP) released afterward. Even so, the policymakers said, “Inflation is expected to return to positive territory in the current quarter.”

Following the RBA meeting and SOMP, Governor Philip Lowe’s testimony also confirmed the policymakers’ bearish bias, which in turn makes today’s event a little important unless flashing any optimistic signs. As a result, AUD/USD traders will closely watch over the central banker’s tone to ascertain the fears of the spreading of the pandemic in the Pacific major.

Concerning the event, Westpac said,

The RBA August meeting minutes will be released at 11:30 am Sydney/9:30 am Singapore, providing additional color on the Board’s policy discussions, but since the meeting 2 weeks ago we have seen the quarterly statement plus heard testimony from Governor Lowe and colleagues, so there should be little new.

TD Securities also considers the event as having a little importance,

We don't think there will be any major surprises to jump out of the Minutes given the in-depth SOMP released days after the Board meeting. CPI reaching 1.5% in Dec 2022 means there is little prospect of a higher cash rate. Of more interest will be any clues on how long the RBA intends to buy bonds to anchor the 3yr rate around 0.25%, but we're not holding our breath.

How could the minutes affect AUD/USD?

While major communication from the Reserve Bank of Australia (RBA) has been dovish off-late, any positive surprises will help the AUD/USD pair to challenge the 18.5-month high flashed during the early August. On the contrary, further confirmation of the pessimism will highlight the risk of negative rates and may fetch the quote backward. However, the US dollar weakness and the recent rally of gold prices may restrict the quote’s short-term declines.

Technically, AUD/USD prices become vulnerable to revisit 0.7200 mark unless crossing 0.7240-45 area, a break of which will in turn drag the quote to 21-day SMA surrounding 0.7160. On the contrary, the pair’s ability to cross 0.7245 enables the bulls to attack the year 2019 top near 0.7300.

Key Notes

AUD/USD Forecast: Nearing this year high on soaring gold prices

AUD/USD wobbles above 0.7200 ahead of RBA minutes

About the RBA minutes

The minutes of the Reserve Bank of Australia meetings are published two weeks after the interest rate decision. The minutes give a full account of the policy discussion, including differences of view. They also record the votes of the individual members of the Committee. Generally speaking, if the RBA is hawkish about the inflationary outlook for the economy, then the markets see a higher possibility of a rate increase, and that is positive for the AUD.