(MENAFN- FxPro) The Australian dollar rallied over 1% against its U.S. counterpart on Tuesday, after the Reserve Bank of Australia left interest rates on hold but signaled the possibility for further cuts later in the year.
AUD/USD hit 0.7696 during late Asian trade, the pair's highest since May 28; the pair subsequently consolidated at 0.7689, jumping 1.10%.
The pair was likely to find support at 0.7595, Monday's low and resistance at 0.7766, the high of May 28.
In a widely expected move, the RBA left its benchmark interest rate at a record-low 2.00%.
Commenting on the decision, RBA Governor Glenn Stevens said monetary policy will remain "accomodative," leaving the door open for further rate cuts.
Meanwhile, the greenback lost some steam as investors locked in gains from the currency's recent rally due to a string of upbeat economic reports and expectations for a U.S. rate hike in the near future.
On Monday, the Institute of Supply Management's index of manufacturing activity was 52.8, up from 51.5 in April and ahead of forecasts for 52.0.
Another report showed that U.S. construction spending rose to the highest level in six-and-a-half years in April, adding to recent signs that the economy is rebounding from a weak first quarter.
The Commerce Department said construction spending jumped 2.2% to an annual rate of $1.0 trillion, the highest since November 2008.
The Aussie was lower against the euro, with EUR/AUD dropping 0.92% to 1.4234.
Later in the day, the U.S. was to report on factory orders.
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