Aussie Fundamentals

As all FX Traders should know, the currency rate depends mostly in the rates differential (expectations) between two countries, on Monday's night (ET) the RBA will release the Cash Rate, and the big question is what the RBA should do with the Cash Rate?


First take a look to the Unemplyment Rate, as you see in the chart, during the last two years the employment is consistently improving in Australia

Second, look at the CPI, as you see in the chart inflation is in the highest points in the last two years, this is a very good sign that the australian economy is improving, this is a good indicator that the RBA will increase the Cash Rate in the following months. 

Finally, look at the Cash Rate chart, I believe that this "fundamental analysis" shows that is very probable to see rate increases during the year, and this would definitely would boost the Aussie against the USD 

The Aussie will break 1.10 this week?

Be careful!, the RBA will release their rate statement on Monday night (ET), if the stament left some room for rate increases the Aussie should break easily the 1.10 resistance, on the other hand any notice that confirms a slower recovery could iniciate a short trend for the following weeks!