18.06.201910:08 Forex Analysis & Reviews: AUD and USD: RBA is ready to lower rates further. The US housing market signals the first problems and a possible slowdown in growth

Yesterday's weak data on the US economy in the second half of the day did not allow the US dollar to regain its lost positions, as a result of which the demand for risky assets remained.

According to the report, producers in the area of responsibility of the Federal Reserve Bank of New York in June reported a slowdown in activity, which is a bad sign for the economy. It is important to note that the index of business activity showed the most significant monthly decline in the history of observations.

According to the data, the production index of the Fed-New York in June of this year fell by 26 points, dropping to a negative value of -8.6 points. Let me remind you that negative values indicate a decline in activity. Economists had expected the index to be 10.5 points in June. More than 30% of respondents said the conditions for doing business were deteriorating.

The indicator of the sentiment of housing builders in the US in June also declined, indicating a decline in this sector of the US economy.

According to the National Association of Home Builders, the housing market index in June 2019 fell to 64 points against 66 points in May. Economists had expected the index to be 67 points in June. The agency noted that the increase in construction costs creates additional concern, however, despite this fact, the demand for houses for one family remains quite good. Index values above 50 mean that the builders are generally positive about the market conditions.

As for the technical picture of the EURUSD pair, the further movement will be based on inflation data in the eurozone, the output of which is scheduled for this morning. If the report is worse than economists' forecasts, the pressure on risky assets will return, which will lead to a breakthrough of intermediate support of 1.1215 and a decrease in EURUSD in the area of larger levels of 1.1180 and 1.1140. On the contrary, a good report will allow the euro to break above 1.1250 and maintain the upward momentum that will lead the trading instrument to the highs of 1.1290 and 1.1340.

The Australian dollar continued to decline against the US dollar after the publication of the minutes of the RBA meeting on monetary policy. The minutes said that the Reserve Bank of Australia expects further lowering of interest rates, but notes that this is not the only tool for economic recovery. The regulator is confident that lower interest rates are unlikely to create a risk of increased borrowing, and will not lead to a sharp increase in inflation. The inflation target continues to play a key role in the RBA in consolidating inflation expectations.