Investing.com - The Australian dollar dropped against its U.S. counterpart on Tuesday, after the Reserve Bank of Australia left interest rates unchanged but signaled the possibility for future easing measures.
AUD/USD hit 0.7064 during late Asian trade, the session low; the pair subsequently consolidated at 0.7075, declining 0.53%.
The pair was likely to find support at 0.7038, Monday’s low and resistance at 0.7142, the high of January 29.
In a widely expected move, the RBA held its benchmark interest rate at 2.00%.
In a statement following the decision, the central bank said however that subdued inflation may “provide scope for easier policy”.
Markets were still jittery amid ongoing concerns over global economic growth after data on Monday showed that manufacturing activity in China contracted for a sixth straight month in January.
China is Australia’s biggest export partner.
Meanwhile, sentiment on the greenback remained fragile after data showed that manufacturing activity in the U.S. contracted again in January, holding near levels not seen since July 2009, and that U.S. consumer spending was flat in December.
The Aussie was lower against the euro, with EUR/AUD advancing 0.80% to 1.5424.