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Forex Flash: RBA keen to scare off AUD inflows - Societe Generale

FXstreet.com (Barcelona) - The RBA meeting comes in a few hours (3.30GMT) with almost null expectations of a rate cut. Ahead of the risk event, the AUD has been performing pretty well, with Societe Generale FX strategist Sebastien Galy noting that "AUD like other commodity currencies seem to be benefitting from some fairly strong reserve diversification flows."

As such, Mr. Galy adds that "the RBA will be keen to dampen these inflows and scare them off, lest it suffer the same fate as the EUR, overloved." The strategist had been suggesting "to buy some front end gamma in AUD on that risk based on our cheap/rich metrics, but now, it will be presumably the time to sell it" he said.

Forex: USD/JPY dips below 93.30

USD/JPY is last at 93.24, off recent session and 4-week lows at 93.10/03, following a yesterday's Nikkei close down -2.21%. Yen has been the strongest currency among majors for last 2 trading days, followed by CHF and GBP. The pair is down about -1% for the week so far, ahead of Average cash earnings in Japan at 01:30 GMT.
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