Global macro overview for 15/03/2016:
The minutes from the RBA's policy meeting published yesterday showed that central bank retained easing bias in March, but it sees no immediate need for further reductions in the key interest rate. The RBA was contented with the progress the Australian economy is making in rebalancing towards non-mining sectors of the economy, helped by low interest rates and the depreciation of the exchange rate over the past couple of years. Nevertheless, the RBA has become increasingly worried about the global financial conditions since the beginning of the year, mainly with fears over China's economic condition and unstable outlook for monetary policy in the other major economies. In conclusion, low inflation provides room for further interest rate cuts, but the central bank remains cautious amid signs that global uncertainty was impacting domestic economy so far.
Let us now take a look at the AUD/USD technical picture on the daily chart. The market has been capped at the technical resistance of 0.7598 and currently it retreats from that level towards the next support at the level of 0.7411. Any breakout below this support would suggest that bears are in full control of this market and the sell-off might accelerate further.