AUD Pressured After RBA Dovish Shift

AUD is the weakest performer in the G-10 space at the margins as there was a dovish tone to the RBA's post-meeting statement as they raised the cash rate 25bps.

• The RBA removed language about the need for hikes in the months ahead, as well as noting that inflation pressures may have peaked. AUD/USD fell ~0.8% from peak to trough, support was seen below $0.67 as the pair pared losses to sit at $0.6710/15. Earlier in the session the trade balance for January was a touch narrower than expected, a surplus of $11.7bn was recorded vs $12.25bn exp however there was little reaction in the AUD.
• NZD/USD is a touch firmer, up ~0.1% from yesterday's closing price. Kiwi has observed narrow ranges for the most part, with little follow through on moves. AUD/NZD is softer, down ~0.4%, last printing at $1.0820/30.
• Yen is little changed today, USD/JPY has observed a ¥135.85/136.15 range for the most part with little in meaningful moves. January's Labor Cash Earnings printed at 0.8% below the expected 1.8%, Real Cash Earnings fell 4.1% vs -3.2% exp.
• EUR and GBP are marginally firmer, however ranges have been tight in Asia.
• BBDXY is down ~0.1%. 10 Year US Treasury Yields are little changed, e-minis are up ~0.2%.
• Fed Chair Powell's semi-annual Monetary Policy report to the Senate Banking Committee provides Tuesday's highlight.