FX.co ★ Australian Dollar Holds Steady Ahead of RBA Decision

The Australian dollar held steady above $0.64 on Friday after experiencing a turbulent week, as investors prepared for the Reserve Bank of Australia's policy decision next week. While it is broadly anticipated that the RBA will lower the cash rate by 25 basis points to 3.85%, the anticipation of more significant easing has diminished. Robust labor market data released earlier in the week helped to moderate expectations for rate cuts. According to official reports, the Australian economy added 89,000 jobs in April, significantly surpassing projections of 20,000, bringing total employment to a new peak of 14.64 million. Consequently, markets now foresee approximately 75 basis points of rate reductions by the end of the year, a reduction from the 100 basis points predicted just a few weeks ago. Additionally, the US-China trade deal mitigated concerns of a global economic downturn, providing further support to the risk-sensitive Australian dollar.