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Forex Flash: RBA minutes next; traders to focus on cut threats - Westpac

The release of the minutes from the RBA Board’s 5 Feb meeting at 00.30GMT will center market attention in Asia. According to Westpac FX analyst Sean Callow, "while the subsequent Statement on Monetary Policy should have provided all the detail we need on the RBA view, selected quotes from the minutes do sometimes move AUD..."

As a reminder, "on the day, Gov Stevens said a steady hand was warranted given some better global news over year end and the “substantial easing of policy” already in place, balanced against below trend domestic growth and muted inflation" Sean says.

In view of Mr. Callow, "AUD traders should be mostly focused on whether 'scope to ease policy further' seems to be a clear threat of a rate cut soon or more of a rhetorical device to prevent markets from swinging towards pricing flat or even higher rates."

Forex: AUD/USD stuck around 1.03 ahead of RBA minutes

AUD/USD is last at 1.0304, flat so far for the week, with US markets having been closed over Monday. The pair dipped yesterday to fresh 4-day lows at 1.0275, recovering from there till late London session highs at 1.0315. AUD/USD awaits now RBA monetary policy minutes at 00:30 GMT, looking for hints for next meeting. With cash rate futures implying less and less chances of a rate cut by next March meeting, lastly around the 30%, and most analysts consulted by Bloomberg calling for a halt, and probably cutting by next May meeting, all eyes will be on the RBA minutes in hour and a half.
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Forex: USD/JPY selling-off on Japan's FinMin comments

The Japanese Yen is trading higher as the rhetoric game by Japanese politicians continues. This time, Japan's finance mininister Mr. Aso is the one talking the Yen up saying the country is not considering revision to BoJ law, adding that foreign bond purchases are not being considered at the moment. As a reminder, this last headline somehow contradicts what Mr. Abe said yesterday.
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