AUD/USD: Aussie Rally Stalls as Domestic Drivers Deteriorate

The Australian Dollar has experienced an unusual rally without any apparent domestic catalysts. The currency has traded within a narrow range of about 20 pips, holding above 0.7050 and edging down 0.15% inside it.

This is the tightest daily range for the pair in weeks, following a run-up of nearly 200 pips from the late-June trough near 0.6850. The 50-day Exponential Moving Average (EMA) above 0.7000 was reclaimed and has since flattened out beneath price.

The situation is made more complicated by the deterioration of domestic inputs during this period, including a rate decision next Tuesday that is not expected to influence anything. A Reuters poll of 37 economists produced no forecasts for any changes, with market-implied odds of an increase in low single digits.