Australian dollar outlook: RBA minutes marginally beneficial to AUD, forecasters at UniCredit say currency to remain week

In the wake of the minutes we see the pound sterling to Australian dollar (Currency:AUD) exchange rate is 0.2 pct down on Monday's closing rate at 1.5526.

The euro to Australian dollar rate is 0.1 pct lower at 1.3124 while the Australian dollar to US dollar is 0.09 pct higher at 0.9818.

Please be aware: The above quotes are taken from the wholesale spot markets - your bank will affix their own discretionary spread when passing on their rate. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering more currency. Please find out more here.

"The minutes showed that the RBA considered the rate cut as appropriate to spur the economy, given still subdued credit growth, business conditions again below average and inflation still contained. The RBA also reaffirmed that the AUD remains historically high," says a morning currency outlook note issued by UniCredit Bank.

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According to UniCredit the RBA minutes overnight confirmed what the bank had already signalled after cutting the OCR to the record low of 2.75% this month, "the AUD is thus expected to remain weak close to 0.98 at the moment."

Currency markets remained relatively quiet yesterday, although the USD was slightly weaker across the board. Indeed, the Fed exit strategy is still the theme and caution ahead of Bernanke’s address tomorrow points to range trading and further consolidation for today.

Short term forecasts favour an extension of the Australian dollar's recent rebound.

Trading Central have consulted the charts today and say:

"Long positions above 0.975 with targets at 0.985 & 0.988 in extension. Alternative scenario: Below 0.975 look for further downside with 0.9705 & 0.967 as targets.

"A support base at 0.975 has formed and has allowed for a temporary stabilisation."

British pound exchange rates at Currency Watch

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