The Australian dollar is broadly higher today, and is currently up against all major currencies. AUD is the strongest against the Japanese yen and the euro. Despite the move up, note that trading volumes remain fairly light. Thanks to Chinese New Year and a public holiday in the US yesterday, AUD/USD is seeing below-average trading volumes. In general, moves that are accompanied by low trading volumes are discounted by traders. Turning to the RBA's minutes, the bank mostly repeated its previous views. Specifically, it stated that it expects a gradual improvement in inflation while wage growth is likely to be subdued. A rise in the Australian dollar would further impede growth and inflation. The minutes suggest that the RBA is likely to remain on hold. Turning to Assistant Governor Bullock, she said that mortgage stress remains low in Australia, despite high levels of consumer indebtedness. Our short-term outlook on the currency remains neutral, while our medium-term outlook is bullish.
AUD/USD is up slightly and trading just above 0.7910. EUR/AUD is down and trading above 1.5610. GBP/AUD is down and trading above 1.7630.
This is a fairly light week for economic data relating to the Australian dollar. The RBA’s meeting minutes suggested that the Bank remains on hold. RBA Assistant Governor Bullock stated that mortgage stress in Australia remains low. Tomorrow, we’ll see the wage price index. On Thursday, we’ll see new motor vehicle sales. Last week, Australian jobs were slightly ahead of expectations. However, the number of full-time jobs fell.