- The RBA left Australian interest rates on hold at 4.25%
- They stressed again that there is scope for lower rates should the global economy slow down
- They also noted that Chinese growth is starting to moderate
- Australian current account deficit AUD8.4 billion
- PBOC adviser says Yuan close to equilibrium level
- Japanese wages showing signs of increasing
- UK retail sales fall on like-for-like basis
- Regional stockmarkets turn lower, -1.25% on average
- Gold $1705/oz, Oil $106.75/bbl
The AUD was again the main mover during the Asian session. AUD/USD closed in NY near 1.0670, rallied to a session high after the Australian current account data, which was somewhat of a surprise given that the data was worse than expected. Thereafter was a gradual drift lower but the sell-off picked up steam after the comments from the PBOC adviser which suggested that the Yuan is unlikely to be allowed to appreciate much further for now but that the band will be expanded gradually. AUD/USD tried to rally after the RBA statement but couldn’t get above 1.0650 and immediately posted fresh session lows. NZD selling was also a significant factor, especially against the Yen. Ranges: 1.0600/90
USD/JPY opened near 81.50 and has been at the mercy of cross flows in an 81.32/57 range.
EUR/USD has played second fiddle to the AUD with EUR/AUD and EUR/NZD demand balancing out EUR/JPY selling and USD demand. Ranges: 1.3185/1.3226
Cable 1.5846/82; EUR/CHF 1.2050/60
