NEW YORK (Forex News Now) – The Australian dollar shot up against its U.S. counterpart on Tuesday, on minutes from the Reserve Bank of Australia’s most recent policy-setting meeting and mixed U.S. data.
In U.S. afternoon currency trading, AUD/USD hit 0.883, up a huge 1.7 percent on the day.
Minutes of the RBA’s July meeting, which were released earlier in the day, suggested that the bank could raise interest rates; and Glenn Stevens, the bank’s governor, said Tuesday that the RBA would do so if needed.
According to forex analysis, AUD/USD was likely to touch support around the daily low, 0.8667, and encounter immediate resistance around the high of July 14, 0.8447.
Also Tuesday, an official report showed that U.S. housing starts hit their lowest level in eight months in June. But a separate report showed an unexpected increase in building permits during the month, offering hope of a future rise in homebuilding.
Meanwhile, the Aussie surged versus the yen: AUD/JPY traded at 77.14, up 2.45 percent.