AUD Trading Outlook (03-11-2010)

The Australian Dollar (AUD) was the best performer on Tuesday as the RBA increased interest rates to 4.75% despite the majority of the market leaning towards a pause. In a bold move, accompanying central bank statements highlighted a boisterous labor force, and signaled &ldquo the moderation in inflation is close to ending&rdquo with further upside on inflation likely in the medium term. Comments of the like were digested by markets as leaving the door open for further rate hikes. The AUD traded at fresh post float high in offshore trading as a result of the Reserve Bank&rsquo s decision to tighten. The AUDUSD traded with a low of 0.9857 a high of 1.0023 before closing at 0.9994. Momentum on the top side appeared capped as markets await the outcome of this evenings FOMC.