Australian Dollar Soars as Capex Data Bolsters RBA Policy Outlook

By DailyFx | Updated August 27, 2014 AAA

DailyFX.com -

Talking Points:

  • Private Capital Expenditure at 1.1% Y/Y for 2Q vs. -0.9% Expected, -2.5% Prior Quarter
  • Australian Dollar Rises as Better-Than-Expected Reports Bolsters RBA Rate Expectations
  • Stay Updated with Major Economic Releases Through DailyFX’s Economic Calendar

The Australian Dollar rose sharply after Australia’s Bureau of Statistics reported Private Capital Expenditure figures for the second quarter of 2014. The release revealed that companies invested 1.1 percent more in their businesses compared to the same period last year, after three continuous quarters of decline. The figure beat expectations of a contraction of 0.9 percent and prior quarter’s fall of 2.5 percent.

The Australian Dollar likely appreciated because the upbeat data fueled bets for an earlier than expected rate increase from the Reserve Bank of Australia. The central bank, in its last few policy statements, has hinted at a decline in investments from companies and framed its monetary policy to accommodate the shortfall. The contrarian expansion in capital expenditure probably bolstered tighter policy expectations from the RBA as the benchmark Australian 10-year government bonds yields rose after the data was released.

Australian Dollar Soars as Capex Data Bolsters RBA Policy Outlook

AUDUSD [15 mins – 07/28/2014] Chart created using FXCM Marketscope.

You May Also Like

COMPANIES IN THIS ARTICLE
Related Forex Analysis
  1. Forex News

    Weekly Trading Forecast: FOMC, GDP, Greece and Much More Ahead

  2. Forex News

    AUD/USD to Eye March High on Less-Dovish RBA, Fed Delay

  3. Forex News

    AUD/USD Technical Analysis: Quiet Consolidation Cotninues

  4. Forex News

    AUD/USD Continues to Flirt with Important Behavior Change

  5. Forex News

    FX Crowd Positions Point to Continued US Dollar Losses, Euro Gains

Trading Center