RBA to express its level of discomfort with AUD today - NAB

FX Strategists at National Australia Bank (NAB) are out with their brief preview on what to expect from today’s RBA monetary policy decision, in the wake of the recent appreciation in the AUD.

Key Quotes:

"The AUD RWTI is now over 10% above its equilibrium level. Similar deviations in the past have triggered 1) a change in RBA commentary on the currency and in some cases 2) RBA rate cuts."

"While the chances of the RBA cutting rates over the coming months are negligible, we think the Board has the arguments to increase its level of discomfort with currency in the Statement tomorrow, if they so choose to."