AUD/USD: Aussie Subdued, Markets Eye Fed Minutes

 | Apr 06, 2016 08:57AM ET

The Australian dollar is almost unchanged on Wednesday, following sharp losses this week. At the start of the North American session, AUD/USD is trading at 0.7530. In the US, today’s highlight is the minutes from the Federal Reserve’s last policy meeting. We’ll also hear from two Fed members, Loretta Mester and James Bullard. Australia releases AIG Construction Index. On Thursday, the US releases Unemployment Claims, and Janet Yellen will deliver a speech at event in New York.

There were no surprises from the RBA, which held the course and made no changes to the benchmark rate of 2.00%. The rate has been pegged at this level since May 2015, and although the RBA has often said it will not hesitate to cut rates, it appears that the central bank has little appetite for further easing, despite weak inflation numbers and an economy hurt by weak Chinese demand. The RBA played the same tune in Tuesday’s rate statement, as Governor Glenn Stevens stated that “continued low inflation would provide scope for easier policy, should that be appropriate to lend support to demand.” One could make a solid argument that Australian inflation levels have indeed remained very low for a “continued” period, yet the RBA continues to stand on the sidelines. Given this context, the markets are unlikely to read much into this statement.

AUD/USD Fundamentals

Wednesday (April 6)

  • 3:40 RBA Assistant Governor Christopher Kent Speaks
  • 10:30 US Crude Oil Inventories. Estimate 3.1M
  • 12:20 US FOMC Member Loretta Mester Speaks
  • 14:00 US FOMC Meeting Minutes
  • 18:30 US FOMC Member James Bullard Speaks
  • 19:30 Australian AIG Construction Index

Upcoming Key Events

Thursday (April 7)

  • 8:30 US Unemployment Claims. Estimate 271K
  • 17:30 US Fed Chair Janet Yellen Speaks

*All release times are DST

AUD/USD for Wednesday, April 6, 2016