AUD/USD Flat As Markets Eye RBA Minutes

 | Jul 14, 2014 11:35AM ET

The AUD/USD is showing little movement on Monday, as the pair trades just shy of the 0.94 line in the North American session. There are no releases out of Australia or the US, but the markets are keeping a close eye on the RBA Policy Meeting minutes, which will be released early on Tuesday.

Australian employment data was a mix in June. Employment Change rebounded in June with a strong gain of 15.9 thousand, easily beating the estimate of 12.3 thousand. At the same time, Unemployment Rate rose to 6.0%, the highest level seen since February. This edged above the estimate of 5.9%. Meanwhile, consumer and business confidence levels, both of which are important catalysts for economic growth, looked solid. NAB Business Confidence hit its highest level since January, while Westpac Consumer Confidence gained 1.9%, an eight-month high.

In the US, employment data continues to impress. Last week, Unemployment Claims dropped to 304 thousand, well below the estimate of 316 thousand. Employment numbers for June looked sharp, led by a jump in Nonfarm Payrolls and a drop in the unemployment rate. The strong employment numbers have increased speculation about an interest rate hike by the Federal Reserve, and remarks by Fed policymakers will be closely scrutinized as the markets look for clues as to the timing of any rate moves.

The Federal Reserve minutes did not shed much light on when the Fed plans to raise interest rates, but policymakers did agree to wind up the QE scheme by October. The asset purchase program flooded the economy with over $2 trillion, and the Fed has been steadily reducing the program since last December. Winding down QE, which currently stands at $45 billion/month, will require several more tapers by the Fed, but that shouldn't pose a problem, given the solid employment data the economy has been churning out.