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AUD/USD binary signal - RBA Interest Rate Decision - 06 June 2017

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Expiry Time: 
20:00 GMT
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Policy makers at the Reserve Bank of Australia met this morning to decide on interest rates. The RBA held the overnight cash rate steady at 1.50%, as widely expected and refrained from making any further changes to interest rates or monetary policy. In the accompanying statement following the monetary policy decision, the RBA said that there was no major change to the central bank's views on both the global and domestic economies. The central bank's statement showed that it remained upbeat on the domestic growth prospects.

Gross domestic product (GDP) growth is expected to slow into the end of the year, but policy makers adjudged that growth is expected to remain around 3%. Inflation is also expected to continue to rise despite the recent slowdown. On the employment side of things, the RBA official statement said that the Australian labor market remained mixed but cited forward looking indicators which suggest a pick-up in jobs.

The central bank also touched upon the exchange rate for the Australian dollar. It noted that the depreciation in the Australian dollar since 2013 has managed to keep the momentum going in growth. However, the central bank highlighted the risks of an appreciating exchange rate that could possibly dent the optimistic growth outlook.
The RBA's meeting comes days ahead of the first quarter GDP print.

Various economists polled are expecting GDP growth to slow, rising 0.2%, following a 1.1% increase in the fourth quarter of 2016. The decline in the GDP is expected amid the cyclone that hit Australia earlier this year. This is expected to have a significant impact on the economic growth. However, growth is expected to increase.

The Australian dollar is seen maintaining the gains following the RBA's interest rate decision and the monetary policy statement. For today's binary options signals, we recommend AUD/USD PUT options for a 20:00 GMT expiry time. We would purchase PUT options at 0.7485, following which we can expect to see a decline towards the end of the day.

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion. All risks and coasts associated with online trading are your responsibility.