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Aussie dollar trades lower after RBA's hint on Aug rate cut

Xinhua, July 20, 2016 Adjust font size:

The Australian dollar is still reeling from the Reserve Bank of Australia's minutes which hinted that the August rate cut could be on the cards.

At the Asian open on Wednesday, the local unit was trading at 75.04 U.S. cents, down from 75.14 cents on Tuesday.

RBA policy makers are seriously considering a rate cut pending data for consumer prices, the jobs market and housing, BK Asset management director of FX Strategy Boris Schlossberg told the AAP.

"The tone of the (July meeting) minutes suggested that the August meeting would be 'live' especially if inflation data, which is due on July 27, proves to be dovish," said Schlossberg.

Schlossberg said the news surprised Aussies, predicting the currency would lose much of its lustre if the central bank decides on easing the interest rates.

Commonwealth Bank of Australia currency strategist and international economist Joseph Capruso said the local unit is likely to remain consolidated following yesterday's RBA minutes meeting.

"If inflation is low enough in next week's Consumer Price Index (CPI), the best guess is still a rate cut in August. We see risks AUD is heavy in the near term ahead of next week's CPI," he said. Enditem