Eyes On RBA Rhetoric

Monday was a session of two halves for AUD/USD. Post-election NZD strength and firmer e-minis generated some topside impetus in Asia & London morning, but the pair turned its tail later on as equity benchmarks across Europe and in the U.S. registered losses. Participants scrutinised duelling headlines re: U.S. fiscal stimulus talks ahead of the looming Tuesday deadline.

• The rate has been heavy this morning, even as e-minis re-opened on a slightly firmer footing. It last trades -9 pips at $0.7065. The low of Oct 15 at $0.7056 provides the initial bearish target and a break here would open up Sep 28 trough at $0.7029. On the topside, a recoil above Oct 15 high of $0.7170 would open up trendline resistance, intersecting at $0.7201.
• Victorian Premier Andrews said he wants to lift the so called "ring of steel", preventing Melbournians from travelling to regional Victoria, before Christmas, but has not mentioned any particular date.
• Elsewhere, Australia said it will take part in the annual Malabar naval drill with the U.S., India and Japan, which may further strain its relations with Beijing.
• Highlights in Australia today include a speech from RBA Asst Gov Kent, RBA Oct MonPol meeting minutes and weekly payroll data. Looking further afield, flash retail sales hit Wednesday, RBA Dep Gov Debelle's comments & NAB Business Confidence are due Thursday, while flash CBA PMIs come out Friday.