The Aussie dollar has had a massive rally overnight on the back of the RBA’s decision to leave a soft easing bias and news that European inflation is rising and Greece is close to a deal.
That meant the euro has rocketed higher and is back in the 1.1150 region.
That in turn sparked the biggest one-day rally for the Aussie dollar since the RBA decided to hold rates steady back in April.
The terribly timed combination won’t please RBA governor Glenn Stevens at all. Fresh from saying again yesterday that “further depreciation seems both likely and necessary, particularly given the significant declines in key commodity prices”, the Aussie dollar is up more than 2% and closing in on 78 cents.
Here’s the chart: