RBA statement was seen as dovish - BBH

Analysts at BBH explain that RBA kept policy steady overnight, as expected and the statement was seen as dovish, however, as the central bank noted a deteriorating labor market and expressed concern about a strong currency.  

Key Quotes

“Governor Lowe also criticized the nation’s banks for having lax lending practices, adding that regulators are prepared to take more macro prudential measures to limit this.  In other words, the bank is in no hurry to hike rates.  This helped negate an earlier AUD bid on the back of better than expected February trade data.”

“AUD is testing its 200-day MA near .7550.  Break below sets up a test of the March low near .7490.  A break below .7455 and then .7385 is needed for a more bearish scenario to unfold.  Lower iron ore prices aren’t helping, falling below $80 for the first time since January.”