Monday Sees Oil In Driving Seat, Focus Turns To RBA

AUD/USD shook off its initial weakness Monday and recoiled in tandem with oil prices, as Russian Energy Min Novak and local industry reps discussed the possibility of holding up the planned easing of OPEC+ output curbs. The news and a resultant rebound in oil prices allowed AUD/USD to register gains at the end of the day.

• Focus now moves to today's monetary policy decision from the RBA, as well as their SoMP, due for release on Friday. As always, we have published our comprehensive preview of the meeting. Elsewhere, there are some global risks on the radar, including the U.S. election & FOMC decision.
• Earlier this morning, ANZ Roy Morgan Weekly Consumer Confidence index inched higher to 99.9 from 99.7, rising for the ninth consecutive week, but "the details suggest some caution" as current financial conditions registered the biggest decline since March.
• Just worth repeating that trade tensions between Australia and China have been re-escalating recently. Beijing has implemented curbs on Australian lobster, barley or timber exports, but refused to publicly link them with politics, pointing to contaminations detected in Australian shipments. The Global Times ran an opinion piece criticising Aussie media outlets for "groundless hype about economic retaliation" and accusing Canberra for seeking "special clearance treatment".
• AUD/USD last trades at $0.7053, little changed on the day. Oct 29 high of $0.7076 provides the initial bullish target and a break here would open up trendline resistance/Oct 23 high at $0.7138/58. Bears look for a dip through Nov 2 low of $0.6991. Below there would expose the 23.6% retracement of the Mar - Sep rally at $0.6965.
• On the data front, quarterly & monthly retail sales and weekly payroll data are due Wednesday, while trade balance comes out Thursday.