A$ Underperforms But Back Above 66c, RBA Today

Aussie underperformed most of the G10 on Monday except for the yen and kiwi. AUDUSD was down slightly to 0.6613 after a low of 0.6585 and is now around 0.6615. There were a number of breaks below 66c but they didn’t persist. Weaker risk sentiment during the APAC session following mixed China data had weighed on Aussie but it found support from stronger US equities later. The USD index was slightly lower.

• AUDUSD continues to trade in a range. Key resistance is at 0.6714, May 16 high, and key support at 0.6576, June 10 low, together they represent key short-term directional triggers.
• Aussie is up 0.2% against the yen to 104.32, close to the intraday high. AUDNZD range traded through the European/US sessions and is now up 0.1% to 1.0784. AUDEUR is down 0.3% to 0.6162 as the euro recovers following the political-related sell off. AUDGBP is down 0.2% to 0.5206.
• Equities were mixed with the S&P up 0.8%, Euro stoxx +0.9% but FTSE down 0.1%. Oil prices rose sharply with Brent +2.2% to $84.41/bbl. Copper is 0.8% lower and iron ore is around $107/t.
• Today the focus is on the RBA decision at 1430 AEST followed by Governor Bullock’s press conference at 1530. Rates are unanimously expected to be left at 4.35% and we don’t expect a change in the stance that the Board won’t rule “anything in or out” (see MNI RBA Preview).