The Australian dollar fell sharply late in Asia trading yesterday after the central bank signalled it has scope to cut rates again, despite holding interest rates steady at its first meeting of the year, as expected.
The dollar fell to an intraday low of $US1.0391 following the RBA decision, from $US1.0448 before the bank announced its move. At the close it was trading at $US1.0406, down from $US1.0437 on Monday.
Barclays FX strategist Hamish Pepper said the dollar should be able to find good buying support around the $US1.034 area.
Investors will be focusing on upcoming domestic data for fresh cues about how the RBA responds next month.
Michael Blythe, the chief economist at Commonwealth Bank, said the central bank's easing cycle had probably bottomed.
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