Buying AUDUSD on Australian GDP growth and RBA rate hold prospects

Australia's economy picked up steam in the second quarter, primarily driven by household consumption. The central bank's intention to keep interest rates on hold until the end of the month is also supporting the AUDUSD pair.

According to the Australian Bureau of Statistics, gross domestic product (GDP) grew by 0.6% in Q2. This result exceeded the anticipated 0.5% rise and doubled the previous quarter's revised figure. Annual growth stood at 1.8%, which is also above the 1.6% forecast. The data slightly surpassed the RBA's expectations, thus strengthening the national currency. The yield on three-year government bonds, which is sensitive to changes in monetary policy, continued to gain speed, hitting a 7-week high. Financial markets expect the regulator to keep rates steady in September and cut them in November. Right now, this is making AUDUSD more powerful.

Last month, the central bank lowered its interest rate to 3.6%, marking the third reduction in a year. Officials also indicated that further easing would be necessary to achieve their employment and inflation targets. Despite the rate being at its lowest since April 2023, the Reserve Bank of Australia (RBA) believes that policy still remains "somewhat restrictive".

The overall recommendation is to buy AUDUSD. Profits are taken at 0.6620. Stop loss is placed at 0.6500.

The volume of your open position should be calculated so that the potential loss (protected by a Stop Loss order) does not exceed 1% of your deposit. If your account balance does not allow opening a position of this size, it is better to avoid entering the market on this signal and wait for other trade options that meet low-risk criteria.