The Australian dollar is trending lower today after the latest minutes meeting from the Reserve Bank of Australia where they left open the door open for further rate reductions should the need arise.
At 10.58am (GMT) the Aussie dollar was trading at US74.58c down 0.78 percent from yesterday’s close.
In their latest minutes meeting the central bank noted that inflation had remained below the intended target and further rate cuts may be possible in order to lift the figure to the appropriate level.
“The available data suggested that the domestic economy had continued to grow at a slightly below-trend pace” the RBA noted
“Continued low inflation would provide scope to ease monetary policy further, should that be appropriate to lend support to demand” they added.
In what may turn out to be a make or break jobs report release on Thursday for the Aussie dollar, the RBA noted that while the unemployment rate rose slightly last month, it was generally stable and the outlook was quiet positive.
The main concern over the last few months was the wage growth, which had remained at persistently low levels,
“There was a small decline in employment in January and a modest rise in the unemployment rate, following a run of much better-than-expected outcomes in the December quarter. Leading indicators of employment had increased further and were consistent with employment growth in the months ahead. Wage growth had remained at quite low levels” The bank said.
A further rise in the unemployment rate in Australia on Thursday is going to put more pressure on the RBA to cut interest rates.