AUD recovery extends as Lowe talks down.......>

FOREX: AUD recovery extends as Lowe talks down effectiveness of easy policy

-The AUD's recent recovery from cycle lows of $0.6832 continued Monday morning

as a speech from RBA governor Lowe talked down the effectiveness of easy

monetary policy. The RBA governor discussed the limits of what monetary policy

can achieve, highlighting that easing is unlikely to be as effective as it has

been in the past. This helped boost AUD/USD briefly north of $0.6950, hitting

the best levels since June 12th.

-Elsewhere, price action is muted, with a very light data calendar Monday doing

little to stir volatility. Tensions in the Gulf remain a source of concern, with

the US reportedly threatening a new wave of sanctions against Iran in a fresh

escalation after the shooting down on a US drone last week.

-ECB's Lautenschlaeger speaks at 1200BST in the only real speech of the session.

EUR/USD looks underpinned by a slew of large E1.9bln option expiries rolling off

at today's 10am cut layered between $1.1390-00. Dallas Fed Manufacturing

Activity crosses in US hours, but focus remains on the G20 summit at the

tail-end of this week.