The RBA just knocked the Australian dollar back below US78c

The Australian dollar is at its lowest level since July after the October RBA rates decision.

The Aussie fell below US78c after the central bank’s monthly rates statement cautioned on the potential problems from an appreciating exchange rate.

A short time ago the currency was trading at 0.7796.

While only a small fall it reflects a slightly more dovish twist to the RBA’s assessment of economic conditions.

US dollar weakness has seen the Australian dollar rally in recent weeks, at some points as high as US81c.

“The higher exchange rate is expected to contribute to continued subdued price pressures in the economy,” the RBA statement said. “It is also weighing on the outlook for output and employment. An appreciating exchange rate would be expected to result in a slower pick-up in economic activity and inflation than currently forecast.”

Here’s the chart, via, looking back to July.

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